Latest news with #JoanneHsu
Yahoo
19-07-2025
- Business
- Yahoo
Consumer sentiment edges up on expectations inflation will cool
This story was originally published on CFO Dive. To receive daily news and insights, subscribe to our free daily CFO Dive newsletter. Dive Brief: Consumer sentiment in July edged up to the highest level in five months as pessimism for the short-term business outlook eased and expectations for inflation in a year fell to 4.4% from 5%, the University of Michigan said Friday. At the same time, household expectations for personal finances declined last month and sentiment persists well below both the level in December and the historical average, the university found in a monthly survey. 'Consumers are unlikely to regain their confidence in the economy unless they feel assured that inflation is unlikely to worsen, for example if trade policy stabilizes for the foreseeable future,' Joanne Hsu, director of the university's consumer surveys, said in a statement. Dive Insight: Recent stability in consumer sentiment coincides with mixed economic signals, along with widening opinions among Federal Reserve officials on the outlook for jobs and inflation, and whether to cut borrowing costs as soon as this month. Retail sales rose 0.6% in June after a two-month slump. Ten out of 13 retail categories recorded sales gains, including motor vehicles, food and beverages, and building materials, the Census Bureau reported Thursday. Unemployment eased last month to 4.1% from 4.2% in May as U.S. payrolls expanded by 147,000, a healthy clip. Yet state and local government, rather than the private sector, accounted for roughly half of the hiring. Also, the consumer price index increased at a 2.7% annual rate in June compared with 2.4% the prior month, the Bureau of Labor Statistics said Tuesday. Imported goods led the price gains, indicating that tariffs have to a degree fueled inflation. The price for apparel, household furnishings and appliances rose 0.4%, 1% and 1.9%, respectively, the BLS said. Prospects for inflation, employment and economic growth hinge to a big degree on whether tariff-induced inflation eases after a few months or persists into next year. Several Fed officials in recent weeks have warned that import prices may provoke a sustained rise in prices. They have favored holding off on a reduction in the main interest rate until gaining greater clarity on price pressures. 'I see upward pressure on inflation from trade policies, and I expect additional price increases later in the year,' Fed Governor Adriana Kugler said Thursday. 'Given the stability in the employment side of our mandate, with the unemployment rate still at historically low levels, elevated short-run inflation expectations and goods inflation rising due to the upward pressure from tariffs, I find it appropriate to hold our policy rate at the current level for some time,' Kugler said in a speech. Import duties will probably push up inflation by about 1 percentage point during the second half of this year 'and the first part of next year,' New York Fed President John Williams said Wednesday. Holding the federal funds rate at its 'modestly restrictive' level from 4.25% to 4.5% 'is entirely appropriate to achieve our maximum employment and price stability goals,' Williams said in a speech. Fed Governor Christopher Waller disagrees. On Thursday he called on his fellow policymakers to cut the federal funds rate by 0.25 percentage point at their meeting this month. 'Tariffs are a one-off increase in the price level and do not cause inflation beyond a temporary surge,' he said in a speech. Also, 'while the labor market looks fine on the surface, once we account for expected data revisions, private-sector payroll growth is near stall speed and other data suggest that the downside risks to the labor market have increased,' Waller said. 'With inflation near target and the upside risks to inflation limited, we should not wait until the labor market deteriorates before we cut the policy rate,' he said. Over time, the central bank should aim to trim the benchmark rate to 3%, a 'neutral' level that Fed officials believe would neither slow nor spur economic growth, Waller said. Recommended Reading Jobless claims edge up, amplifying Fed signals for rate cut Sign in to access your portfolio
Yahoo
18-07-2025
- Business
- Yahoo
Americans are the most optimistic about the economy since just after Trump's inauguration
There's one survey to rule them all, when it comes to getting a gut feeling for the health of the American consumer. Running monthly since 1946, the University of Michigan's consumer sentiment survey offers an uninterrupted, long-term record of American consumers' mood across wars, booms, recessions, and technological change. The July edition shows renewed optimism, according to the University of Michigan's preliminary results, as the Consumer Sentiment Index climbed to 61.8 from 60.7 in June. This slightly surpasses analyst expectations and marks the index's highest point in five months—February, just after President Donald Trump took office again but months before he shocked markets and allies with his 'Liberation Day' tariffs in April. Still, it's only cause for a muted celebration. Surveys of Consumers Director Joanne Hsu characterized the results as 'little changed' from June, 'inching up about one index point.' She acknowledged that it's a five-month high, but 'it remains a substantial 16% below December 2024 and is well below its historical average.' A closer look at the data shows that high-wealth consumers don't share in the generally improving outlook, either. The glum high-wealth American The Current Economic Conditions Index rose 3.1 points to 66.8, indicating growing confidence in near-term business and job prospects. However, the Consumer Expectations Index—reflecting expectations for the coming six months—rose only slightly to 58.6 and remains down 14.8% from last year. Notably, respondents' outlook on their own finances fell by about 4%, signaling continued individual financial concerns despite the broader improvements. And despite a recent uptick, the surveyors highlight that feelings among high-wealth consumers are still down 17% from December 2024. Short-run business conditions improved about 8%, whereas expected personal finances fell back about 4%. Consumers are unlikely to regain their confidence in the economy unless they feel assured that inflation is unlikely to worsen, for example if trade policy stabilizes for the foreseeable future. At this time, the interviews reveal little evidence that other policy developments, including the recent passage of the tax and spending bill, moved the needle much on consumer sentiment. But there has been a movement on expectations around inflation. Inflation expectations drop sharply One of the most pronounced shifts in sentiment concerns inflation. Year-ahead inflation expectations dropped for the second straight month to 4.4%, down from 5.0% in June and from a peak of 6.6% in May, marking the lowest reading since February 2025. Long-run inflation expectations also receded, falling for a third consecutive month to 3.6% (from 4.0% in June). While these are the most moderate readings in months, both remain higher than levels seen in late 2024, highlighting ongoing wariness about longer-term inflation risk. Hsu noted that inflation remains top of mind for many Americans, with renewed optimism tempered by concerns that price increases could reignite, especially in the context of recent trade policy moves. 'Consumers are unlikely to regain their confidence in the economy unless they feel assured that inflation is unlikely to worsen, for example if trade policy stabilizes for the foreseeable future,' Hsu explained. Respondents reported that legislative developments such as recently enacted tax and spending bills had little discernible effect on their overall sentiment. The uptick in consumer confidence comes even as recent economic data show robust retail sales and resilient labor markets, suggesting a disconnect between consumer perceptions and macroeconomic trends. For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. This story was originally featured on Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Los Angeles Times
18-07-2025
- Business
- Los Angeles Times
Wall Street closes a record-breaking week with a quiet finish
Wall Street closed its third winning week in the last four with a quiet finish on Friday. The S&P 500 edged down by a whisper, less than 0.1%, after setting its all-time high the day before. The Dow Jones Industrial Average fell 142 points, or 0.3%, and the Nasdaq composite edged up by less than 0.1% to add its own record. Norfolk Southern chugged 2.5% higher after an AP source said it's talking with Union Pacific about a merger to create the largest railroad in North America, one that would connect the East and West coasts. Any such deal, though, would likely face tough scrutiny from U.S. regulators. Union Pacific's stock fell 1.2%. The heaviest weight on the market, meanwhile, was Netflix, which fell 5.1% despite reporting a stronger-than-expected profit. Analysts said it wasn't a surprise given the stock had already soared 43% for the year so far coming into the day, six times more than the gain for the S&P 500. American Express likewise delivered a better-than-expected profit report, but its stock lost 2.3%. Analysts pointed to slowing growth in some underlying trends, such as the number of cards it issued. Exxon Mobil sank 3.5% and also tugged on the market. It had been challenging Chevron's $53 billion deal to buy Hess, but an arbitration ruling in Paris about Hess assets off Guyana's coast allowed the buyout to go through. Chevron fell 0.9% after losing an early gain. Stronger-than-expected profit reports for the spring did help several stocks rally. Charles Schwab climbed 2.9%, Regions Financial jumped 6.1% and Comerica added 4.6%. All told, the S&P 500 slipped 0.57 to 6,296.79 points. The Dow Jones Industrial Average dropped 142.30 to 44,342.19, and the Nasdaq composite rose 10.01 to 20,895.66. In the bond market, Treasury yields eased after a report suggested U.S. consumers may be feeling less fearful about coming inflation. They're bracing for inflation of 4.4% in the year ahead, down from last month's projection of 5%, according to preliminary results from a University of Michigan survey. That's important because expectations for high inflation can feed into behaviors that create a vicious cycle that keeps inflation high. Overall sentiment among consumers, meanwhile, was a hair better than economists expected but still well below its historical average. 'Consumers are unlikely to regain their confidence in the economy unless they feel assured that inflation is unlikely to worsen, for example if trade policy stabilizes for the foreseeable future,' according to Joanne Hsu, the survey's director. The yield on the 10-year Treasury sank to 4.42% from 4.47% late Thursday. The two-year Treasury yield, which more closely tracks expectations for what the Federal Reserve will do with its short-term rates, also dropped. It fell to 3.87% from 3.91%. A top Fed official, Gov. Chris Waller, said late Thursday that the Fed should cut its overnight interest rate as soon as its next meeting in a couple weeks. That follows sharp criticism from President Donald Trump, who has been castigating the Fed for holding interest rates steady this year instead of cutting them, as it did late last year. Lower rates could give the economy a boost, and Trump has implied they could help the U.S. government save money on its debt payments, though that's uncertain. The interest rates Washington has to pay on its longer-term debt can depend more on what bond investors think than on what the Fed does, and they can even move in opposite directions. The chair of the Fed, meanwhile, has been insisting that he wants to see more data about how Trump's tariffs will affect the economy and inflation before the Fed makes its next move. The downside of lower interest rates is that they can give inflation more fuel, and prices may already be starting to feel the upward effects of tariffs. Traders on Wall Street think it's much more likely that the Fed will resume cutting interest rates in September, rather than later this month, according to data from CME Group. In stock markets abroad, indexes were mixed across Europe and Asia. Hong Kong's Hang Seng jumped 1.3%, but Tokyo's Nikkei 225 slipped 0.2% ahead of an election for the upper house of parliament on Sunday that could wipe out the ruling coalition's upper house majority. Choe writes for the Associated Press.
The Star
18-07-2025
- Business
- The Star
U.S. consumer sentiment virtually unchanged in July
WASHINGTON, July 18 (Xinhua) -- U.S. consumer sentiment was virtually unchanged in July, according to preliminary data released Friday by the University of Michigan. The widely watched consumer sentiment index inched up marginally to 61.8 from the previous month's 60.7. While sentiment reached its highest value in five months, it remains a substantial 16 percent below December 2024 and is well below its historical average, the report found. Short-run business conditions improved about 8 percent, whereas expected personal finances fell back about 4 percent. "Consumers are unlikely to regain their confidence in the economy unless they feel assured that inflation is unlikely to worsen, for example if trade policy stabilizes for the foreseeable future," said Joanne Hsu, director of the University of Michigan's monthly Surveys of Consumers. "At this time, the interviews reveal little evidence that other policy developments, including the recent passage of the tax and spending bill, moved the needle much on consumer sentiment," Hsu said. Year-ahead inflation expectations fell for a second straight month, plunging from 5 percent last month to 4.4 percent this month. Long-run inflation expectations receded for the third consecutive month, falling back from 4 percent in June to 3.6 percent in July. Both readings are the lowest since February 2025 but remain above December 2024, "indicating that consumers still perceive substantial risk that inflation will increase in the future," Hsu said.
Time of India
18-07-2025
- Business
- Time of India
US consumer sentiment improves in July
U.S. consumer sentiment improved in July, and while inflation expectations continued to decline, households still saw substantial risk of price pressures increasing in the future. The University of Michigan 's Surveys of Consumers on Friday said its Consumer Sentiment Index rose to 61.8 this month from a final reading of 60.7 in June. Economists polled by Reuters had forecast the index would increase to 61.5. Explore courses from Top Institutes in Select a Course Category Finance others Others Management Project Management Data Science CXO PGDM Leadership Digital Marketing Data Science healthcare Cybersecurity MBA Public Policy Product Management Design Thinking Degree Healthcare Artificial Intelligence MCA Technology Operations Management Data Analytics Skills you'll gain: Duration: 9 Months IIM Calcutta SEPO - IIMC CFO India Starts on undefined Get Details Skills you'll gain: Duration: 7 Months S P Jain Institute of Management and Research CERT-SPJIMR Fintech & Blockchain India Starts on undefined Get Details "Consumers are unlikely to regain their confidence in the economy unless they feel assured that inflation is unlikely to worsen, for example if trade policy stabilizes for the foreseeable future," Joanne Hsu, the director of the Surveys of Consumers, said in a statement. "At this time, the interviews reveal little evidence that other policy developments, including the recent passage of the tax and spending bill , moved the needle much on consumer sentiment." Consumers' 12-month inflation expectations dropped to 4.4% from 5.0% in June. Long-run inflation expectations fell to 3.6% from 4.0% last month. "Both readings are the lowest since February 2025 but remain above December 2024, indicating that consumers still perceive substantial risk that inflation will increase in the future," Hsu said. Live Events
