US consumer confidence remains high in November

By

Cassidy Mantor

Published
Nov 24, 2017

The University of Michigan Surveys of Consumers reports US consumers will spend more this holiday season because they are confident in their expectations concerning income, employment and inflation.

According to Richard Curtin, chief economist at Surveys of Consumers, consumer certainty has changed regarding their economic expectations. Curtin said that, despite the messaging from the media, "increased certainty about future income and job prospects has become a key factor that has supported discretionary purchases."

Curtin cited the potential for tax changes as well as new Fed leadership as two factors that could affect consumer spending in the long run. This is the second longest expansion period since the mid-1800s, with consumer sentiment reportedly reaching an all time high in 2004. Nonetheless, data indicates a 2.7% increase in consumption expenditures in 2018.

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While consumer sentiment dipped slightly from last month's ten year high, Curtin notes that the data shows changes in fiscal and monetary policies have not had a noticeable impact on consumer expectation. The data does not offer insight into whether this means consumers may have adjusted to new circumstances of lower pay in a post-recession economy.

Regardless, for retailers this means that this could be the best holiday shopping season in a decade.