Americans' Economic Outlook Rapidly Improving, Consumer Survey Finds
Summary from the AllSides News Team
Americans' outlook of the economy sharply improved over the last two months.
For Context: In the final months of 2023, outlets across the spectrum sought to understand why Americans’ view of the economy was out of sync with traditional economic indicators. Despite strong output and weakening inflation, many Americans were pessimistic about the state of the economy. Outlets attributed this disconnect to a number of factors– political angst, high gas prices, and still-high prices on goods. In the few months since outlets set out to quantify the economic pessimism, some have changed their outlook.
Details: According to a new report from the University of Michigan Consumer Sentiment Index, consumer sentiment rose 29% over the past two months, marking the largest two-month increase since 1991.
Key Quote: Surveys Director Joanne Hsu said, “For the second straight month, all five index components rose … Like December, there was a broad consensus of improved sentiment across age, income, education, and geography. Democrats and Republicans alike showed their most favorable readings since summer of 2021.”
How the Media Covered It: Axios (Lean Left bias) attributed the increase to a decline in gas prices and a rise in stock prices. The Washington Examiner (Lean Right bias) credited the efforts of the Federal Reserve, stating the data shows “just how far the Fed has come in its inflation fight.” The Wall Street Journal (Center bias) stating that “recession fears for 2024 are fading.”
Featured Coverage of this Story
From the Left
America's economic mood is improving fast: survey
In the last couple months, Americans' sour sentiment has grown a lot sunnier.
Why it matters: Since the pandemic, U.S. consumers have consistently reported depressed economic sentiment, despite that fact that America's economy has staged a better recovery from COVID than the rest of the world's rich nations have.
State of play: Starting two months ago, America's mood started heading back up.
A University of Michigan index that tracks consumer sentiment has surged more than 28% since November.
Context: Since the late 1970s, the only other period of such a...
From the Center
Americans Are Suddenly Upbeat About Economy. Sentiment Just Logged Its Biggest Jump in Decades.
Americans are rapidly becoming much more upbeat about the economy.
Consumer sentiment leapt 13% in the first half of January from December, the University of Michigan said Friday. That came on the heels of a sharp rise in December, causing the index to surge a combined 29% from November, the biggest two-month increase since 1991. The pickup in sentiment was broad-based, spanning consumers of different age, income, education and geography.
The recovery in sentiment “is likely to provide some positive momentum for the economy,” said Joanne Hsu, the Michigan survey’s...
From the Right
Consumer sentiment soars to highest level since before inflation took hold
Consumer sentiment jumped in January and expectations for inflation fell, a sign that consumers are feeling more comfortable with the economy.
The University of Michigan Consumer Sentiment Index soared to 78.8 in January, well above forecast expectations of 70. That is a 21.4% change from this time last year. Sentiment is also at the highest level since July 2021, before the U.S. began grappling with too-high inflation.
Year-ahead expectations also improved. The index for consumer expectations lurched to 75.9 in January from 67.4 in December. Inflation expectations softened after falling in December and...
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