US consumer sentiment on a solid footing

The University of Michigan index of consumer sentiment rose to 92.1 in the preliminary October estimate, above both forecast (89.5) and consensus (89.0) expectations. The current conditions index rose to 106.7 (previous: 101.2), and consumer expectations advanced to 82.7 (previous: 78.2). This morning's data reverse the softness seen in the September survey results and put sentiment back on a solid footing overall.

Within the details of consumer expectations, expected personal finances (128, previous: 121) moved up to the highest level since 2007, and the 5-year economic outlook (104, previous: 93) rose to the highest level since June. Inflation expectations declined one-tenth in the mid-month estimates, at both the 1-year (2.7%, previous: 2.8%) and 5-10 year (2.6%, previous: 2.7%) horizons. Buying conditions for durables (164, previous: 151) surged.

"Overall, the preliminary October results suggest a notable firming in consumer sentiment. We take positive signal from these data and view them as supportive for our expectation that consumption growth will continue to outperform", says Barclays.