Data released by the United States on Friday (10th) showed that the University of Michigan consumer confidence index in the United States reported 50.2 in June, a record low, less than the expected 58, and far below the previous value of 58.4. Long-term consumer inflation overestimated upwards, breaking out of the narrow range of the past few months to hit a new high since 2008.
Observing the details of the data, the current situation index was reported at 55.4, lower than the expected 62.5, and the value before May was 63.3; the expected index was at 46.8, lower than the expected 54.5, and the value before May was 55.2.
The U.S. Department of Labor announced today that the consumer price index (CPI) in May increased by 8.6% year-on-year, the highest since 1981. The annual growth rate of the core CPI, which excludes food and energy costs, was also as high as 6%. Higher than market expectations of 8.3% and 5.9%, it highlights that inflation has further accelerated, increasing the price pressure faced by consumers and threatening US economic growth.
In terms of inflation expectations, which have attracted much attention from the market, the one-year inflation forecast is 5.4%, higher than the expected 5.3%, and the previous value is 5.3%, which is the same as the previous high, which is a new high since 1981; the 5-year inflation forecast is 5.3%. 3.3%, the highest since 2008, and above the narrow range of 2.9% to 3.1% in the past few months, from 3% previously.
During the survey, consumers were strongly concerned that inflation continued to eat into incomes, and while consumer spending has remained strong so far, the generally deteriorating sentiment could lead to weaker spending, which in turn slows economic growth, said Joanne Hsu, director of the Michigan Consumer Confidence Survey. A record 88% of consumers expect U.S. interest rates to rise next year.
About 20% of consumers rated their personal finances as deteriorating, with 46% attributing it to inflation, up from 38% in May; only one survey since 1981 has It’s still high now, when the economy was already in recession.
On the whole, gasoline prices have brought heavy pressure on consumers, and about one group of consumers took the initiative to mention oil prices during the interview, while the proportion in May was 30%, and only 13% a year ago. In addition, consumers also took the initiative to mention supply shortages for 9 consecutive months.
The American public’s assessment of buying conditions has fallen to a record low, and all income groups have become increasingly pessimistic. Inflation has outpaced wage growth, sending many Americans drawing down their savings and deepening debt. A more pronounced slowdown in consumer spending is a recession risk factor as high prices reduce discretionary incomes, meaning less discretionary spending.
Consumer confidence affects economic growth in the coming months. Pessimistic consumer sentiment will dampen spending levels and thus affect the economic recovery. Conversely, optimistic consumer sentiment will help future economic growth.