Business News Asia
A University of Michigan survey found that consumer sentiment rose to 51.1 in July.
Consumers expect inflation to reach 5.2% next year, down from 5.3% surveyed last month and the lowest level since February.
Over the next five years, consumers expect inflation to be 2.8%, lower than last month’s 3.1%, which is the lowest level in a year.
Federal Reserve Chairman Jerome Powell clarified after the Fed’s June 15 monetary policy meeting that consumer inflation expectations in the University of Michigan Consumer Sentiment Survey were “considerable.” The University of Michigan survey, released on June 10, was one of the main reasons the Fed made its decision at its June 15 meeting to move toward a 0.75% rate hike.
The sentiment index was weighed down by rising inflation concerns. As a result, consumers’ expectations of the current and future economic situation have declined.
In addition, consumers expect inflation to reach 5.4% next year, higher than the 4.2% surveyed in the same period last year. Over the next five years, inflation is expected to reach 3.3%, more than the 2.8% recorded in the same period last year.