Consumers began the new year with a decided gloomy outlook.
Consumer sentiment declined in the first weeks of January to its lowest level since Trump was elected, the University of Michigan’s survey showed Friday. The index of consumer sentiment plunged to 90.7 from 98.3, missing economist expectations for a 97 read.
“The decline was primarily focused on prospects for the domestic economy, with the year-ahead outlook for the national economy judged the worst since mid 2014. The loss was due to a host of issues including the partial government shutdown, the impact of tariffs, instabilities in financial markets, the global slowdown, and the lack of clarity about monetary policies,” the survey’s chief economist, Richard Curtin, said.
The index of expectations fell 10 percent to the lowest level since 2014. It is 9.3 percent below where it stood a year ago.
The index’s measure of current conditions also declined on a monthly basis but is about even with last January’s reading.
“While the January falloff in optimism is certainly consistent with a slowdown in the pace of growth, it does not yet indicate the start of a sustained downturn in economic activity,” Curtin said.