UMich Sentiment Drops Further In Jan, Weakest In A Decade

After preliminary January data showed a further weakening in University of Michigan’s Consumer Sentiment survey, the final print weakened even further with the headline dropping from 70.6 in December to 68.8 flash to 67.2 final. Both current conditions and future expectations also deteriorated during the month

Source: Bloomberg

This is the lowest headline and current conditions print since 2011.

Democrats’ confidence dropped to its lowest since the election and Independents confidence are at their weakest since 2012 (as Repuboican sentiment ticked up modestlY)

Source: Bloomberg

However all parties expectations worsened as overall confidence in government economic policies is at its lowest level since 2014, and the major geopolitical risks may add to the pandemic active confrontations with other countries.

Source: Bloomberg

Buying attitudes worsened to new record lows for large household durables and vehicles and housing buying attitudes limped back lower after a modest rebound….

Source: Bloomberg

Finally, and perhaps most importantly in the current environment, inflation expectations rose to 4.9% (for the next year) and 3.1% for the next 5-10 years – the highest since 2008 and 2011 respectively…

Source: Bloomberg

It looks like two years of “transitory” preaching has un-anchored the religious belief that The Fed has everything under control.

Get back to work Mr.Powell.