UMich: Consumers cheer up while keeping a suspicious eye on AI
SPY•The University of Michigan’s November consumer sentiment index rose three points to 51, above analysts’ expectations of 48, while consumers’ one-year inflation expectations fell to 4.3% from 4.7%. Survey respondents also expressed growing anxiety about a possible AI bubble, though cost-of-living concerns remained more prominent.
1. Sentiment improves
The University of Michigan’s initial November consumer sentiment reading rose three points to 51, compared with analysts’ expectations that it would hold at 48. Consumers’ assessments of current conditions improved 7.1%, while near-term expectations rose 4.3%.
2. AI and inflation concerns
Sentiment fell 5% among consumers with the largest stock portfolios, and survey comments showed growing anxiety about a possible AI bubble, the director of consumer surveys said. Cost-of-living concerns remained at the forefront. Respondents’ one-year inflation expectations eased to 4.3% from 4.7% last month, while five-year expectations were 3.4%, down 0.1 percentage point from October’s final reading.
