By Xavier Fontdegloria


Consumer sentiment in the U.S. increased more than expected in early September, but confidence among Americans remained at depressed levels as coronavirus worries persist, results from a University of Michigan survey showed Friday.

The preliminary estimate of the index of consumer sentiment stood at 78.9 in September compared with a 74.1 reading in August. Economists surveyed by The Wall Street Journal had expected the indicator to come in at 75.4.

September's reading posts a second straight month gain and recovers to June's levels, when consumers felt the reopening of the economy. Those gains were short-lived and quickly reversed in July as Covid-19 infections spiked again.

"Consumer sentiment improved in early September, reaching the top of the range it has traveled since April," said Richard Curtin, the survey's chief economist.

Despite the gains, the indicator is still 15.3% below the figure registered the same month a year earlier.

Consumers' assessment of the current economic conditions increased to 87.5 in September from 82.9 in August. The index of consumer expectations--which reflects the balance of respondents anticipating improved business conditions in the next six months--rose to 73.3 from 68.5 the prior month.

The inflation expectations components moved lower compared with August, with consumer expecting prices to increase 2.7% next year, down from 3.1% in August, and 2.6% over the next five years, down from 2.7% a month earlier.

Data indicated that the election has begun to have an impact on expectations about future economic prospects, Mr. Curtin said, with results from July to September indicating a virtual tie between Joe Biden and Donald Trump when consumers were asked which candidate they thought would win.

"Over the next several months, there are two factors that could cause volatile shifts and steep losses in consumer confidence: how the election is decided and the delays in obtaining vaccinations," he said.

The survey was conducted between Aug. 26 and Sept. 14. The final reading for the month will be published on Oct. 2.


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(END) Dow Jones Newswires

September 18, 2020 10:36 ET (14:36 GMT)

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