University of Michigan Reports the Final Results of its Consumer Sentiment Index for June 2024

The University of Michigan on Friday (6-28-24), released the final results of its Consumer Sentiment Index (CSI) for June.

• The Index of Consumer Sentiment declined to a reading of 68.2 in June, down from May’s reading of 69.1. A month-over-month decline of 1.3%, but up 6.2% year-over-year (64.2 in June 2023).
• The Current Economic Conditions for June dropped to a reading of 65.9, down from May’s reading of 69.6. A month-over-month decline of 5.3%, and down 4.4% year-over-year (68.9 in June 2023).
• The Index of Consumer Expectations climbed to a reading of 69.6 in June, up from a reading of 68.8 in May. A month-over-month increase of 1.2% and up 13.9% year-over-year (61.1 in June 2023).

In remarks and expert analysis prepared to accompany the release of the preliminary June 2024 Consumer Sentiment Index, Dr. Joanne Hsu Ph.D., Consumer sentiment held steady in June; this month’s reading was a scant and statistically insignificant 0.9 index points below May and well within the margin of error. While consumers exhibited confidence that inflation will continue to moderate, many expressed concerns about the effect of high prices and weakening incomes on their personal finances. These trends offset the improvements in the short- and long-run outlook for business conditions stemming in part from expectations for softening interest rates. Still, sentiment is currently about 36% above the trough seen in June 2022.

Dr. Hsu continued, Year-ahead inflation expectations fell from 3.3% last month to 3.0% this month; in comparison, these expectations ranged between 2.3 to 3.0% in the two years prior to the pandemic. Long-run inflation expectations came in at 3.0% for the third consecutive month and have remained remarkably stable over the last three years. These expectations remain somewhat elevated relative to the 2.2% – 2.6% range seen in the two years pre-pandemic.