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Friday, October 25, 2013

Consumer Confidence Dropped Sharply In October

Consumer confidence declined sharply in October, following a large drop in September, according to the University of Michigan’s Consumer Sentiment. The drop in consumer sentiment was driven by the government shutdown and debt ceiling uncertainty. The index in October was 73.2 a drop of 4.3 index points from September. The October level is the lowest value reported in 2013.



The present conditions portion of the index declined 2.7 index points to 89.9. Future expectations, similar to last month, really took a hit from Capitol Hill’s uncertainty, dropping 5.3 points to 62.5.



Inflationary expectations declined slightly from the previous month. The 1-year expectation dropped from 3.3% in September to 3.0% in October. The 5-year expectation also dropped to 2.8%.

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