More of same:

More evidence this has stabilized and maybe reversed:

Expectations up, current conditions down:


Consumer sentiment unexpectedly burst higher in the August flash but the results, warns the report, do not fully reflect the impact of the weekend’s violence in Virginia. The index rose to 97.6 which is well over Econoday’s high estimate and the strongest reading since the post-election surge in January. But the report said “too few” interviews were conducted after the violence and that related fallout may reverse expectations especially for Republicans.

Details of the August flash show an 8.5 point jump in the expectations component to 89.0 with, however, the current conditions component lagging with a 3.4 point decline to 111.0. The step back for current conditions is not a favorable indication for consumer activity in the month of August. And in a negative for Federal Reserve policy makers, inflation expectations are very subdued, unchanged at 2.6 percent for the 1-year outlook and down 1 tenth for the 5-year outlook at 2.5 percent.

Recent History Of This Indicator

Unlike the consumer confidence index which is holding steady near 20-year highs, the consumer sentiment index has been falling back, down more than 5 points from its highs early in the year to 93.4 in July. Econoday’s consensus for the preliminary August report is calling for a moderate rebound to 94.0. July showed continued strength in current conditions but a noticeable slowing in expectations in a divergence that hints at year-end erosion for the headline index.

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