University of Michigan Reports the Final Results of Its Consumer Sentiment Index for November

On Friday, the University of Michigan released the final results of its Surveys of Consumers for November.

• The Index of Consumer Sentiment increased to a reading of 71.8 in November, up from 70.5 in October. This is a month-over-month increase of 1.8% and up 17.1% year-over-year (61.3 in November 2023).
• Current Economic Conditions declined to a reading of 63.9 in November, down from 64.9 in October. This is a month-over-month decline of 1.5% and down 6.4% year-over-year (68.3 in November 2023).
• The Index of Consumer Expectations increased to a reading of 76.9 in November, up from 74.1 in October. This is a month-over-month increase of 3.8% and up 35.4% year-over-year (56.8 in November 2023).

In background and analysis accompanying the report, Surveys of Consumers Director Joanne Hsu said:

“Consumer sentiment was little changed this month, inching up 1.3 index points from October. In November, sentiment extended a four-month stretch of consecutive incremental increases. Post-election interviews were 1.3 points below the pre-election reading, moderating the improvement seen earlier in the month. Overall, the stability of national sentiment this month obscures discordant partisan patterns. In a mirror image of November 2020, the expectations index surged for Republicans and fell for Democrats this month, a reflection of the two groups’ incongruous views of how Trump’s policies will influence the economy. In contrast, current conditions saw insignificant changes this month across the political spectrum, consistent with the fact that the resolution of the election exerted little immediate impact on the current state of the economy. Ultimately, substantial uncertainty remains over the future implementation of Trump’s economic agenda, and consumers will continue to re-calibrate their views in the months ahead.

Year-ahead inflation expectations fell slightly from 2.7% last month to 2.6% this month. The current reading is the lowest since December 2020 and sits within the 2.3–3.0% range seen in the two years prior to the pandemic. Long-run inflation expectations rose from 3.0% last month to 3.2% this month; uncertainty over long-run inflation, as measured by the interquartile range of expectations, increased as well.”