"The ongoing government shutdown has helped push confidence to near-record lows, but one segment of the population is actually feeling more optimistic. The initial reading for the University of Michigan's sentiment index fell to 50.3 in November from 53.6 last month, almost matching the all-time low of 50 from June 2022, when the annual rate of inflation hit its post-pandemic high."
""With the federal government shutdown dragging on for over a month, consumers are now expressing worries about potential negative consequences for the economy," Joanne Hsu, the survey's director, said in a statement Friday. The decline was widespread and was seen across different age groups, income brackets, and political affiliations, she added. But not everyone followed that trend. "One key exception: consumers with the largest tercile of stock holdings posted a notable 11% increase in sentiment, supported by continued strength in stock markets," Hsu said."
"The survey closed before Tuesday's elections, which revealed continued voter discontent about affordability as food and energy prices creep higher. The timing is also notable given that it didn't capture the most recent stock market selloff that sent the Nasdaq to its worst weekly loss since April's trade war chaos. That came as investors grew more concerned about the AI boom looking like a bubble that could pop soon."
Consumer sentiment fell sharply in November, with the University of Michigan index dropping to 50.3 from 53.6, nearly matching the June 2022 low of 50. The prolonged federal government shutdown has increased consumer worries about negative economic consequences. The decline occurred across ages, income brackets, and political affiliations. An exception emerged: households in the top tercile of stock holdings posted an 11% rise in sentiment, buoyed by strong equity markets. The survey closed before recent elections and before a subsequent Nasdaq selloff and rising investor concern about an AI-driven market bubble. Market participation has broadened across income and age groups.
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