U.S. consumer confidence jumped to 97.8, up from 93.8 in February, according to the latest University of Michigan’s Index of Consumer Sentiment.
Chief economist Richard Curtin stated that “the early March gain in sentiment was entirely due to households with incomes in the bottom two-thirds of the distribution.” In fact, “sentiment fell among households with incomes in the top third to 98.5 in early March from 101.7 in February.” Curtin added that “the current level of consumer sentiment at 97.8 hardly indicates an emerging downturn. The data (instead) indicate that real consumption will grow by 2.6% in 2019 and that the expansion will set a new record length by mid year.”
Rising income expectations and lower-than-expected inflation were cited as the primary drivers of the positive outlook. The survey also noted that, “all income groups voiced more positive prospects for growth in the overall economy during the year ahead.”
However, in a separate survey, also released today, the U.S. Federal Reserve stated that “manufacturing production fell 0.4 percent in February for its second consecutive monthly decline.” Manufacturing fell 0.5% in January.