Consumer sentiment edges up in May

NEW YORK (BestGrowthStock) – U.S. consumer sentiment edged up in May from April, in line with forecasts, while one-year inflation expectations were at their highest since June 2009.

The majority of consumers expected interest rate increases during the year ahead, the Thomson Reuters/University of Michigan’s Surveys of Consumers report also showed on Friday.

The preliminary May reading on the overall index on consumer sentiment was 73.3, up from April’s 72.2. Analysts polled by Reuters had predicted a reading of 73.5 for May.

The one-year inflation expectation index rose to 3.1 percent in May the highest since June 2009, from 2.9 percent in April, while the five-to-10-year inflation measure rose to 2.9 percent from 2.7 percent.

The sentiment reading, which is largely unchanged since last September, when it came in at 73.5, is seen as a proxy for consumer spending that fuels 70 percent of the U.S. economy.

“Consumers’ buying plans responded negatively to the decline in available price discounts, although the overall level of buying attitudes for household durables remains well above the year-earlier readings,” Richard Curtin, director of the surveys, said in a statement.

The surveys’ gauge of current economic conditions edged up to 81.1 at the beginning of May from 81.0 in April. The May reading was slightly below the 81.9 forecast by analysts.

The barometer of consumer expectations also rose in May. It came in at 68.3 versus 66.5 in April. It was above the 67 level predicted by analysts.

The index of consumers’ 12-month economic outlook rose to 84 in early May from 80 in April.

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(Reporting by Caroline Valetkevitch; Editing by James Dalgleish)

Consumer sentiment edges up in May