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U.S. consumer sentiment declines amid inflation jitters

(Xinhua) 10:51, November 12, 2022

WASHINGTON, Nov. 11 (Xinhua) -- U.S. consumer sentiment dropped in November amid ongoing anxiety over inflation, according to data released Friday.

The widely watched University of Michigan Survey of Consumers came in at 54.7, down from 59.9 in October.

The survey pointed out an especially steep fall in views on spending on big-ticket items like autos, televisions and kitchen appliances.

The index could signal a coming slowdown in the purchase of consumer goods.

The development comes as the U.S. Federal Reserve continues to hike interest rates in a bid to control inflation, which stands at a 40-year high.

The University of Michigan reading came a day after the consumer price index was reported to grow 0.4 percent in October -- below analysts' 0.6 percent estimate -- signaling that historically high inflation may be cooling.

The news sparked a massive rally in the U.S. stock market, as the Dow Jones Industrial Average surged over 1,200 points in afternoon trading on Thursday.

Investors hoped that the U.S. Federal Reserve would start to ease the pace of interest rate hikes.

"For now, both inflation and higher borrowing costs are squeezing household spending," Jim Baird, chief investment officer at Plante Moran Financial Advisors, was quoted by CNBC.

"For low-income households in particular, higher prices for essentials limit discretionary spending, crimp savings, and contribute to higher credit card debt," he said.

Purchases of durable goods have been falling since the middle of 2021, dropping for the past two quarters after surging early in the COVID-19 crisis.

(Web editor: Zhao Tong, Hongyu)

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