US consumer sentiment deteriorated significantly in November, according to a University of Michigan survey

According to preliminary data released on Friday, the University of Michigan’s US consumer sentiment index fell to 50.3 points in November, the lowest level since June 2022, from 53.6 points in October.

Analysts had expected a November indicator of 53.2 points.

Based on preliminary data, the November value of the sentiment index is 29.9 percent lower than a year ago, and the indicator weakened by 6.2 percent on a monthly basis.

The University of Michigan statement highlighted that as the government shutdown has been going on for more than a month, consumers are worried about the negative consequences affecting the economy.

Among the sub-indexes, the consumer expectations index for the next six months fell from 50.3 points in October to 49.0 points, a six-month low, in line with analyst expectations.

The sub-indicator reflecting the current situation fell to 52.3 points from 58.6 points in the previous month, while analysts had expected an improving figure of 59.2 points.

The one-year inflation expectation rose to 4.7 percent from 4.6 percent in the previous month, thus remaining well above the values ​​​​between 2.3-3.0 percent measured in the two years before the pandemic.

At the same time, the five-year inflation expectation decreased from 3.9 percent in the previous month to 3.6 percent, and long-term inflation expectations remain significantly higher than the 2.2-2.6 percent experienced in the two years before the pandemic values.

The University of Michigan’s sentiment index, along with the Conference Board’s consumer confidence index, is the most important indicator of the expected development of consumption, which accounts for about 70 percent of American GDP.

Researchers at the University of Michigan interview at least 500 people by telephone as part of a representative monthly survey.

The final data for November will be published on November 21.