Data released on Friday showed an unexpected decline in the University of Michigan’s Consumer Sentiment index to the lowest since August. According to analysts at Wells Fargo, sentiment was held back by decreased perception of financial situations and rising COVID case counts.
Key Quotes:
“Most of the decline in sentiment came from the expectations component, which slipped 7.9 points to 71.3. Consumers’ perceptions of current conditions were little changed at 85.8.”
“The drawdown in sentiment seems to reflect decreased perceptions of household finances, which may be a lagged effect of the dwindling fiscal stimulus.”
“More consumers reported lower income than higher income for the first time since 2014.”
“Rising COVID cases weighed on consumer perception in early November, and may cause sentiment to move even lower in the second half of the month.”
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