A recent survey by the University of Michigan found that American consumer sentiment fell to a new decade-long low as concerns about inflation grow.
Danielle Wallace for FOX Business:
The University of Michigan Consumer Sentiment Index (MCSI), a monthly survey of how consumers feel about the economy, personal finances, business conditions, and buying conditions, ended March 2022 at 59.4%, representing a 5.4% decline from the final reading of 62.8% in February 2022 and a 30.0% decline from the index’ reading of 84.9% one year ago in March 2021.
The end of March reading of 59.4% is down by .5% from what was already a decade-long low of 59.7 recorded in mid-March.
The survey found that inflation has been the primary cause of rising pessimism, with an expected year-ahead inflation rate at 5.4%, the highest since November 1981.
The chief economist for the University of Michigan’s Survey of Consumers, Richard Curtin, said… 32% of all consumers expected their overall financial position to worsen in the year ahead, the highest recorded level since the surveys started in the mid-1940s.” He further assessed that “the prevention of inflationary psychology is much less costly before it becomes ingrained in the economic behavior of consumers and firms.”
According to Investopedia, many consumers worried that the Federal Reserve failed to adequately act on chances to nip inflation in the bud at its earlier stages. The MCSI assessed in mid-January that respondents’ confidence in government policies declined to its lowest level since 2014.
MacDailyNews Take: Sigh.
As we wrote last Ma: ‘Tis best to get a handle on inflation, if you know how, while you still can.
Inflation is repudiation. — Calvin Coolidge
When a business or an individual spends more than it makes, it goes bankrupt. When government does it, it sends you the bill. And when government does it for 40 years, the bill comes in two ways: higher taxes and inflation. Make no mistake about it, inflation is a tax and not by accident. — Ronald Reagan
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