Americans grew more optimistic and more satisfied with their current situation in September even as hiring slowed and infection numbers picked up.
The final University of Michigan consumer sentiment survey in September climbed to 80.4 from a mid-month result of 78.9, the University of Michigan said Friday. That is a big gain over August’s 74.1 score.
Economists had projected just an uptick to 79. The actual reading was above the top of the range of estimates, indicating that economists continue to underestimate the strength of the US. consumer.
The September reading is the highest since the pandemic struck in March.
The measure of expectations vaulted 7.1 points higher to 75.6. The current conditions gauge jumped 4.9 points from August to 87.8.
“While consumers have anticipated gains in the national economy ever since the April shutdown, the September survey recorded a significant increase in the proportion that expected a reestablishment of good times financially in the economy,’’ Richard Curtin, director of the survey, said in a statement.
The better outlook was largely driven by an increase in optimism among upper-income consumers.
“The economy will benefit from the increasing pace of spending among households with incomes in the top third,” Curtin said.
The presidential race may be playing a role here. Many Democrats have remained much less optimistic and more negative about current conditions than the broader public throughout the Trump presidency. Some of those Democrats may now be turning optimistic because polls show Democrat nominee Joe Biden ahead of President Donald Trump.
“The data indicate that lower-income households face continued income and job losses compared with the modest gains expected by upper-income households,” Curtin added.
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