US consumer sentiment ticks lower in late August

The University of Michigan index of consumer sentiment ticked down to 91.9 in the final August estimate (prelim: 92.9, July: 93.1), falling below consensus expectations of a nearly unchanged reading of 93.0. The current conditions index declined to 105.1 (prelim: 107.1, July: 107.2) and the expectations component eased to 83.4 (prelim: 83.8, July: 84.1). Year-ahead (2.8%) and longer-term (2.7%) inflation expectations were both unchanged from the preliminary estimate.

 The survey commentary noted that interviewing was extended through August 23 to include 64 additional cases; however, it was still difficult to discern any large shift in sentiment provoked by recent financial market volatility. Comparing the final August and July estimates, current (120, previous: 116) and expected (124, previous: 122) personal finances improved this month, but the near-term (111, previous: 115) and longer-term economic outlook (100, previous: 101) slipped a bit. Purchasing sentiment for durables also stands 9 points below its July level (152, previous: 161).

"We see the slippage in these components of sentiment as likely related to financial market volatility and an increase in concerns over international economic developments. That said, the Conference Board's August survey showed a robust gain in consumer confidence on the month. Taken together, this panel of data suggests that consumer sentiment remains largely intact in August. We look for the preliminary September estimate from the University of Michigan for any evidence of further slippage, but maintain our outlook for solid consumer spending in the months ahead", says Barclays.