On Friday, a monthly Survey from the University of Michigan had revealed that its US Consumer Sentiment Index had witnessed an unprecedented fall in early November as tens of thousands of American households remained fretted about their finances, in part due to a re-imposition of pandemic restrictions amid surging cases across the United States and Europe alongside an indentation of optimism over a fiscal stimulus in a near-term outlook, orchestrating an ominous economic landscape for the United States as the world’s largest economy has been set to wind down the most challenging year since the Great Financial Depression of 1930s.
Aside from that, other Govt. data released on Friday had unfurled that the US producer prices Index kept gathering momentum, as expenses of foods and gasoline had been maintaining their steady rise, though the spike in producer prices would unlikely to impact the inflation readings since an exploding resurgence of pandemic cases alongside uncertainties over the US labour market amid a sheer reluctance to re-hire, had been keeping a lid on inflation, eventually bolstering the US Federal Reserve’s view to keep its monetary policy unchanged at least until end-2021.
US Consumer Sentiment dips, Producer Prices Index gather momentum
In tandem, while the University of Michigan Survey for US Consumer Confidence Index had fallen to 77 earlier this month from a reading of 81.8 in October, wildly missing an analysts’ estimate of a figure of 82, holding a steep lag in further fiscal stimulus accountable behind the latest collapse in US Consumer Confidence Index, a senior economist at Wells Fargo Securities in Charlotte, North Carolina, Tim Quinlan said, “The drawdown in sentiment seems to reflect decreased perceptions of household finances, which may be a lagged effect of the dwindling fiscal stimulus.
More consumers reported lower income than higher income for the first time since 2014. ” Meanwhile, US Labour Department had unveiled a separate statement saying that its Index for US Producer Prices rose to 0.3 per cent last month, mostly boosted by a rise in the prices of foods and gasolines amid a mass-scale pandemic driven disruption in supply chains, marking up the sixth straight month of increase in US Producer Prices Index.