Consumer Sentiment Remains Solid

Consumer sentiment remains solid but has definitely fallen back, to 90.0 for the March flash for the least optimistic readings since October. Weakness is centered in expectations, down 1.9 points to 80.0 which is the lowest reading since September for this component. Declines in expectations point to weakening confidence in the jobs and income outlook. Current conditions are also down but less so, at 105.6 for a 1.2 point decline to hint at a little less strength for the March labor market.

One big plus in the report is a lift in inflation expectations, up 2 tenths for both the 1-year and 5-year outlooks which are both at 2.7 percent. The gains here likely reflect the rise underway at the gas pump but could also perhaps hint at a firming in wages.

The slip in confidence measures has not been dramatic and does not offer any telling insight into the early effects of the 2016 presidential campaign, but it may be signaling a little less strength for consumer spending.

Recent History Of This Indicator:
The election campaign has yet to have measurable impact on the consumer sentiment index which, like other readings on consumer confidence, has been holding steady and reflecting strength in the labor market. Forecasters see a 5 tenths gain to 92.2 for the February flash.