Dec 8, 2023 - Economy

Charted: Economic vibes are shifting

Data: University of Michigan; Chart: Axios Visuals
Data: University of Michigan; Chart: Axios Visuals

The "vibe-cession" is on hold: American consumers felt much better about the economy in early December, Axios' Courtenay Brown writes.

  • So says the University of Michigan's widely followed consumer sentiment index, which jumped a whopping 8 points from the prior month.
  • It was the first increase in four months, with broad improvement in sentiment across all age groups and political affiliations.

Why it matters: A key question has been why Americans felt so down about the economy when key indicators — cooling inflation, boom-like economic growth and healthy jobs growth — have been so strong.

  • Those gloomy consumer vibes have political implications: voters remain dissatisfied with the Biden economy, which by most other measures looks solid.

Of note: Inflation expectations for the year ahead were 3.1%, the lowest since March 2021 — a big drop from the prior month's 4.5% that was enough to fuel a stock market rally.

The caveat: The survey — based on a small sample of roughly 420 consumers — is preliminary and will be finalized in the coming weeks.

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This story was an excerpt from Axios Closer, a recap on the day's biggest business stories.

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