The mood among American consumers is improving. A survey that gauges U.S. consumer sentiment soared to its highest level in more than seven years this month, an unexpected rise that beat analysts’ predictions. With a reading of 86.4, the Thomson Reuters/University of Michigan overall index on consumer sentiment was at its highest point since July 2007.
The strong showing came despite factors that analysts thought would send positive feelings into retreat, including escalating military conflicts, worries over a global economic meltdown and intensifying fear about Ebola outbreaks. “The data show absolutely no signs that fear and panic is about to overtake the consumer sector," survey director Richard Curtin said in a statement.
In more encouraging news, the survey’s reading on consumer expectations improved from 75.4 last month to 78.4 in October – the best tally in two years. Meanwhile, the survey’s gauge of current economic conditions held steady at 98.9, a figure that bested a predicted decline to 98. Looking longer term, the survey’s five-to-10-year inflation outlook remained 2.8%, while the one-year inflation expectation forecast fell from 3% to 2.8%.