Consumer Sentiment Flat

Consumer sentiment is flat, at 90.4 for the August flash for only a 4 tenths gain. Components are mixed with expectations higher, at 80.3 for a 3.5 point gain, but current conditions lower, down 2.9 points to 106.1. The gain in expectations points to rising confidence in the jobs outlook but the decline in current conditions hints at a second month of slowing for consumer spending.

Inflation readings are soft, down 2 tenths for the 1-year outlook to 2.5 percent which likely reflects declining gasoline prices. Five-year expectations are unchanged at 2.6 percent. These two readings underscore the weakness seen in this morning's producer price report and will not make good reading at the Federal Reserve which is working to raise inflation.

Friday's data, that is the current conditions component of this report along with retail sales, are bumps in the road for what had been a prior run of strength for the consumer.

Recent History Of This Indicator:
Consumer sentiment fell a moderate but noticeable 3.5 points in June to 90.0 with weakness centered in expectations, that is the outlook for the economy and the jobs market. This is a possible Brexit effect which forecasters see reversing slightly in the flash August report where the consensus is calling for a 1 point gain to 91.0. July's downtick aside, consumer confidence backed up by solid consumer spending have been the central strength of the U.S. economy.