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Analysts at Nomura are expecting elevated readings in the preliminary University of Michigan survey for August after the index reached 97.9 in July, only 0.3pp below 98.2 in June.

Key Quotes

“Inflation expectations were relatively steady at 2.9% (one year ahead) and 2.4% (5-10 year ahead). The July Conference Board consumer confidence report also showed resilient optimism despite trade-related concerns.”

“Considering strong consumer fundamentals (low unemployment and steady income growth), current economic assessment indicator will likely remain strong and should support near-term consumer spending growth. However, future economic conditions measure will likely moderate as reflection of ongoing trade tensions between the US and China.”

“The current and future conditions in both Michigan and Conference Board surveys have been diverging recently. Coupled with enduring trade tensions, the divergence will likely continue in the near term.”