The expectations of inflation short term in the United States fell in early March to the lowest level in almost two years and the prospects in the long run they also softenedbut consumer confidence continued to fall due to persistently high prices.
Respondents said they anticipate that inflation increase 3.8% over the next yearor, the lowest level since April 2021, according to the preliminary reading from the University of Michigan. They project that prices advance by 2.8% in the next five to ten yearsthe lowest level in six months.
Inflation in the United States reached 6% in February, but annual
The confidence index dropped to 63.4 in early March from 67 in February, the biggest drop since June, data released Friday showed. The median estimate in a Bloomberg survey of economists called for the index to hold steady.
The survey was carried out from February 22 to March 15 and the report says that about 85% of the interviews were completed before the bankruptcy of Silicon Valley Bank. However, it is not clear to what extent trust will be affected when the final college reading for the month is released on March 31.
“Our data indicates little impact of these developments on consumer attitudes,” given that the average consumer generally does not pay much attention to financial developments that do not affect them directly, Joanne Hsu, director of the survey, said in a statement.
Of the interviews completed after March 9, when many companies were advised to withdraw money from SVB, only “a bunch” of consumers spontaneously mentioned bank failures, according to the report.
“That said, the current environment for the dissemination of news and information is very different from other periods of severe market turbulence before the pandemic, so it remains to be seen whether the prominence of financial developments for consumers will increase in the future,” Hsu said.
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