US consumer sentiment hit a new low in an unsurprising turn of events. The sentiment has been on the decline for a while now, and noting a decade low confirms there is little faith in improvements. Growing inflation concerns continue to dominate the overall mindset.
Consumer Sentiment Keeps Dropping
Even though the Fed indicates that interest rate hikes are appropriate, the overall consumer sentiment doesn’t share that optimism. In fact, it hit a new decade low of 61.7 on the University of Michigan’s sentiment index. In January, that same index hit 67.2, confirming sentiment is declining more rapidly than before.
Making matters worse is the declining measure of future expectations. A high figure indicates a bullish outlook or a reversal of overall momentum. Unfortunately, that measure also hit a new decade low at 57.4. None of this bodes well for the future outlook of the US economy, regardless of tales policymakers and government officials may try to spin.
Rising costs for food, housing, and electricity subdue consumer sentiment. Many people expect things to worsen before they can improve, which seems like a fair assessment under the current conditions. Inflation is a very problem, yet banks and governments do their best to sweep it under the rug. On the other hand, consumers see no real improvements over the next five years. There is a clear group of people with negative sentiment and outright pessimism.
It will be intriguing to see how things improve in the future. The consumer sentiment index hints at a very problematic time ahead for the US economy and, by extension, the US Dollar. As the world’s economy hinges on the greenback, the coming years will be either abysmal or yield vast improvements. The jury is still out on that one, though.