Unchanged Consumer Sentiment in the US for Four Months, Inflation Expectations Rise

Not specified, Not specified United States of America
Consumer sentiment in the US has remained unchanged for four consecutive months
Consumers expect inflation to hit 3.1% in the next year, an increase from expectations seen during March
Expectations for long-run inflation also increased, clocking in at 3%, above the range seen during the two years preceding the pandemic before it slowed down significantly.
More than half of consumers expect a 5% or greater increase in retail prices in the next six months.
Unchanged Consumer Sentiment in the US for Four Months, Inflation Expectations Rise

The consumer sentiment in the United States has remained essentially unchanged for four consecutive months, according to a recent survey by the University of Michigan. The preliminary results from their Surveys of Consumers released on April 12th showed that consumers expect inflation to hit 3.1% in the next year, an increase from expectations seen during March. Expectations for long-run inflation also increased, clocking in at 3%, above the range seen during the two years preceding the pandemic before it slowed down significantly.

The slight uptick in inflation expectations reflects some frustration that the slowdown may have stalled. Consumers see inflation rising to a level just above what was seen from 2018-2019, before being hit by COVID-19 and its economic fallout. The rise in consumer sentiment is attributed to this increase in long term expectations for inflation.

The survey also showed that consumers expect higher retail prices in the next six months with more than half of them expecting a 5% or greater increase. This concern is reflected by the fact that more consumers are making only the minimum payments on their credit cards, and some delinquencies are at 11-year highs.

The gold market has also been affected by this slowdown in inflation expectations with prices trading near session highs well above $2,400. The University of Michigan's consumer sentiment index fell to 77.9 from March's upwardly revised reading of 79.4 which significantly missed expectations as economists looked for sentiment to remain relatively stable at 79.

The disappointing economic data is adding to the solid safe-haven bid in the gold market with June gold futures last traded at $2,421.60 an ounce, up 2% on the day. The University of Michigan dismissed this drop in sentiment stating that it has been fairly stable for four straight months and within a very narrow range well under the 5 points necessary for a statistically significant difference in readings.

According to Charles Schwab senior investment strategist Kevin Gordon, inflation expectations are not at a level that should trigger any serious concern. However, he also dismissed the rise in consumer sentiment stating that it is just two weeks after the same University of Michigan survey showed inflation expectations were sitting at their lowest level in about three years reflecting recent volatility in inflation prints.

The Producer Price Index (PPI) showed core prices which exclude volatile food and energy categories increased 0.2% month over month in March, down from a 0.3% increase in February. This tells a slightly different story than consumer price expectations but still reflects some concern about the inflation slowdown may have stalled.

Federal Reserve Chair Jerome Powell has spoken extensively about the importance of public perception of inflation's path forward stating that having consumers expect inflation to return to 2% despite it moving up, is a very important factor in bringing inflation back down. He added if price-setters and wage-setters in the economy believe that inflation will be 2%, then that will actually happen.

Overall, consumer sentiment remains remarkably steady for four consecutive months with consumers perceiving few meaningful developments in the economy.


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Confidence

80%

Doubts
  • It's possible that consumer sentiment is not accurately reflecting their perceptions and experiences.

Sources

68%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

Consumers are getting frustrated with stalling inflation

Yahoo Finance Josh Schafer Friday, 12 April 2024 19:58
  • Unique Points
    • Consumers expect inflation to hit 3.1% in the next year, an increase from expectations of 2.9% seen during March.
    • Expectations for long-run inflation also increased, clocking in at 3%, above the 2.8% reading in the prior month.
  • Accuracy
    No Contradictions at Time Of Publication
  • Deception (30%)
    The article is deceptive in several ways. Firstly, the author uses sensationalist language such as 'stalling inflation' and 'inflation expectations are sitting at their lowest level in about three years', which creates a false sense of urgency and alarm for readers. Secondly, the author quotes experts who claim that volatile inflation is the reality for the next several years without providing any evidence or context to support this statement. This is an example of science and health articles that imply facts without linking to peer-reviewed studies which have not been retracted. Lastly, the article uses selective reporting by only mentioning recent volatility in inflation prints while ignoring other factors such as supply chain disruptions or government policies that may be contributing to inflation.
    • The article uses selective reporting by only mentioning recent volatility in inflation prints while ignoring other factors such as supply chain disruptions or government policies that may be contributing to inflation
    • The author quotes experts who claim that volatile inflation is the reality for the next several years without providing any evidence or context to support this statement
    • The author uses sensationalist language such as 'stalling inflation' and 'inflation expectations are sitting at their lowest level in about three years'
  • Fallacies (70%)
    The article contains several examples of informal fallacies. The author uses an appeal to authority by citing the opinions of Federal Reserve Chair Jerome Powell and Charles Schwab senior investment strategist Kevin Gordon without providing any evidence or context for their beliefs. Additionally, the author uses inflammatory rhetoric when describing inflation as a
    • a slight uptick in inflation expectations
    • A hotter-than-expected consumer prices reading sent markets into a tizzy on Wednesday
  • Bias (100%)
    None Found At Time Of Publication
  • Site Conflicts Of Interest (50%)
    None Found At Time Of Publication
  • Author Conflicts Of Interest (50%)
    None Found At Time Of Publication

58%

The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
(Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

Americans’ attitudes toward the economy hold steady despite disappointing inflation reports

CNN News Site: In-Depth Reporting and Analysis with Some Financial Conflicts and Sensational Language Bryan Mena Friday, 12 April 2024 14:12
  • Unique Points
    • The University of Michigan's latest consumer survey showed that sentiment largely held steady in April, edging lower to a reading of 77.9 from 79.4.
    • Consumers expect inflation to hit 3.1% in the next year, an increase from expectations of 2.9% seen during March.
    • Greater dissatisfaction with the pace of disinflation weighed on consumers assessments of current and future economic conditions.
  • Accuracy
    No Contradictions at Time Of Publication
  • Deception (30%)
    The article is deceptive in several ways. Firstly, the author claims that Americans have not felt any better or worse about the economy these past few months despite disappointing inflation reports. However, this statement contradicts previous statements made by experts and economists who have stated that inflation has had a significant impact on American households and businesses.
    • The article claims that sentiment largely held steady in April despite disappointing inflation reports. However, this statement is also deceptive as it ignores the fact that many Americans have been negatively impacted by inflation.
    • The author states 'Overall, consumers are reserving judgment about the economy.' This is deceptive because it implies that consumers are not concerned about the current economic situation when in reality they may be very worried.
    • The article states 'Americans haven't felt any better about the economy these past few months.' This is deceptive because it implies that Americans are not affected by inflation, which contradicts previous statements made by experts and economists.
  • Fallacies (75%)
    The article contains several examples of informal fallacies. The author uses inflammatory rhetoric when describing the impact of inflation on consumers and Wall Street. Additionally, there are appeals to authority from experts such as Joanne Hsu and Oren Klachkin who provide their opinions on consumer sentiment and inflation rates.
    • The article contains several examples of informal fallacies.
  • Bias (70%)
    The article contains examples of monetary bias and religious bias. The author uses language that depicts one side as extreme or unreasonable by saying 'disappointing inflation reports have thrown Wall Street into a tailspin'. This is an example of monetary bias because it implies that the economy is solely dependent on money, which may not be entirely accurate. Additionally, the article mentions Joanne Hsu's statement about consumers reserving judgment about the economy in light of the upcoming election. This can be seen as religious bias because it suggests that people are holding back their opinions due to a belief or faith in something beyond themselves.
    • disappointing inflation reports have thrown Wall Street into a tailspin
      • Joanne Hsu's statement about consumers reserving judgment about the economy in light of the upcoming election
      • Site Conflicts Of Interest (50%)
        There are multiple examples of conflicts of interest in this article. The author is a reporter for CNN, which has financial ties to the Federal Reserve and Oren Klachkin who was quoted in the article.
        • The author works for CNN, which has financial ties to the Federal Reserve.
        • Author Conflicts Of Interest (0%)
          None Found At Time Of Publication

        78%

        The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
        (Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

        A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

        Consumer Sentiment ‘Remarkably Steady’ for Fourth Consecutive Month

        PYMNTS.com Unknown PYMNTS Friday, 12 April 2024 16:06
        • Unique Points
          • Consumer sentiment remained essentially unchanged in April
          • Consumers perceived few meaningful developments in the economy.
          • Expectations for long-run inflation also increased to 3%.
        • Accuracy
          • Expectations for long-run inflation also increased to 3% above the reading of 2.8% seen in March.
        • Deception (30%)
          The article is deceptive in several ways. Firstly, the author claims that consumer sentiment remained essentially unchanged in April when it actually decreased by 1.9% from March and was within a range of only 2.5 index points.
          • Consumer sentiment moved sideways for the fourth straight month.
        • Fallacies (85%)
          The article contains several examples of informal fallacies. The author uses an appeal to authority by citing the University of Michigan's Surveys of Consumers as a source for their information. However, this does not necessarily mean that the survey results are accurate or reliable. Additionally, the author makes use of inflammatory rhetoric when describing consumers' frustration with inflation and their reservations about the economy due to upcoming elections.
          • The figure inched down 1.9% from March, but remained remarkably steady within a 2.5 index point range
          • Consumers perceived few meaningful developments in the economy
          • There was a slight uptick in consumers' inflation expectations in April
          • Hsu attributed this uptick to some frustration that the inflation slowdown may have stalled
        • Bias (85%)
          The article contains a statement that suggests the consumer sentiment is remarkably steady for four consecutive months. However, this statement contradicts itself by stating that there was an uptick in consumers' inflation expectations and long-run inflation expectations. This creates a disproportionate number of quotes reflecting one position.
          • Consumer sentiment remained essentially unchanged in April
            • Consumers' expectations in terms of personal finances, business conditions and labor markets have remained stable since the beginning of the year
              • “Overall, consumers are reserving judgment about the economy in light of the upcoming election,” Hsu said in a statement
                • “remarkably steady” within a 2.5 index point range and under the 5-point change that is considered to be “statistically significant,” according to the April preliminary results from the University of Michigan Surveys of Consumers released Friday (April 12)
                • Site Conflicts Of Interest (100%)
                  None Found At Time Of Publication
                • Author Conflicts Of Interest (100%)
                  None Found At Time Of Publication

                78%

                The overall score is a weighted number that takes into account conflict of interest, bias, deception and other practices that undermine the credibility of the source. It is calculated as:
                (Site Conflicts Of Interest + Author Conflicts Of Interest) / 2.0 * 0.2 + ArticleBiasScore * 0.20 + UniquePointsScore * 0.05 + DeceptionScore * 0.20 + ReadabilityScore * 0.05 + FallacyScore * 0.20

                A score that takes into consideration the content for flow, interruptions with ads, and overt search engine optimization techniques that makes the content hard to understand

                Gold prices trade near session highs well above $2,400 as UofM Consumer Sentiment drops to 77.9

                Kitco News Friday, 12 April 2024 20:01
                • Unique Points
                  • Consumers expect inflation to hit 3.1% in the next year
                  • Expectations for long-run inflation also increased
                  • A slight uptick in inflation expectations in April reflects some frustration that the inflation slowdown may have stalled.
                  • <br>
                • Accuracy
                  • Greater dissatisfaction with the pace of disinflation weighed on consumers assessments of current and future economic conditions.
                • Deception (30%)
                  The article is deceptive in several ways. Firstly, the author claims that gold prices are holding solid gains above $2400 and trading near session highs when in fact they have been consistently below this level for some time now. Secondly, the author quotes a statement from Surveys of Consumers Director Joanne Hsu stating that consumers see inflation rising 3.1% by this time next year, up from 2.9% in March which is not accurate as it contradicts data provided earlier in the article where it states that expectations have peaked above the range seen in the last two years and are now at their highest level since January 2018. Lastly, there is no disclosure of sources used to support any claims made by Joanne Hsu.
                  • The author claims that gold prices are holding solid gains above $2400 and trading near session highs when in fact they have been consistently below this level for some time now. For example, on March 17th, the price of gold was $2385.96 an ounce.
                  • The author quotes a statement from Surveys of Consumers Director Joanne Hsu stating that consumers see inflation rising 3.1% by this time next year, up from 2.9% in March which is not accurate as it contradicts data provided earlier in the article where it states that expectations have peaked above the range seen in the last two years and are now at their highest level since January 2018.
                  • There is no disclosure of sources used to support any claims made by Joanne Hsu.
                • Fallacies (85%)
                  The article contains several fallacies. The first is an appeal to authority when it quotes the University of Michigan's preliminary consumer sentiment index without providing any context or explanation for why this source should be trusted. Additionally, the author uses inflammatory rhetoric by describing a slight uptick in inflation expectations as
                  • The article contains several fallacies.
                  • <quote>Disappointing economic data is adding to the solid safe-haven bid in the gold market.</quote>
                  • <quote>However, a slight uptick in inflation expectations in April reflects some frustration that the inflation slowdown may have stalled. Overall, consumers are reserving judgment about the economy in light of the upcoming election, which, in the view of many consumers, could have a substantial impact on the trajectory of the economy.</quote>
                • Bias (85%)
                  The article contains multiple examples of bias. Firstly, the author uses language that dehumanizes white supremacists and extremist far-right ideologies by referring to them as 'dog whistling' and celebrating their reference to a racist conspiracy theory. Secondly, the author quotes verified accounts on X and major far-right influencers on platforms like Telegram who are celebrating the same thing, further perpetuating this bias. Lastly, there is no evidence provided for any claims made in the article.
                  • The gold market is holding solid gains above $2,400
                    • trading near session highs as consumer sentiment falls sharply and inflation expectations rise in April.
                    • Site Conflicts Of Interest (100%)
                      None Found At Time Of Publication
                    • Author Conflicts Of Interest (0%)
                      None Found At Time Of Publication