U. of Michigan Sentiment 98.1 vs 98.2 Expected

U. of Michigan Sentiment 98.1 vs 98.2 Expected

Consumer optimism reached the highest level in the past decade in the January 2015 survey--since 103.8 was recorded in January 2004. The improvement was due to consecutive gains in each of the past six months, with the Sentiment Index improving by 20% since July of 2014. Importantly, the gains in the past half-year were as large among households with incomes under $75,000 as over that amount. Consumers judged prospects for the national economy as the best in a decade, with half of all consumers expecting the economic expansion will continue for another five years. The anticipated strength in the overall economy has been accompanied by more favorable income and employment expectations. While renewed strength in consumer spending will boost the pace of economic growth in 2015, most consumers are counting only on modest income gains during the years ahead. Without sufficient wage gains, consumers will be forced to demand large price discounts to complete their purchases, adding to disinflationary pressures. Overall, the more optimistic data indicate that total real personal consumption expenditures will grow at 3.3% during

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