Despite a rollout of pandemic vaccine alongside optimisms over another round of trillion-dollar stimulus bill as early as by mid-March, US consumer sentiment fell surprisingly over the first half of February as pessimism sustains among households having had an annual income below $75,000.
In factuality, latest holocaust in consumer sentiment revealed by a survey report from the University of Michigan earlier on Friday came against the backdrop of a revival in US economy with factory activities and housing markets anchoring the momentum, however, there had still been stagnations in US labour market, but layoffs declined sharply over the recent past.
However, following release of University of Michigan’s survey data on US consumer sentiment, several analysts were quoted saying that the dip in sentiment had illustrated a K-shaped economic recovery where well-paid workers usually perform well, but lower-paid households having annual earnings below $75,000 might lose out.
US Consumer Sentiment dips unexpectedly in early-February
In tandem, according to University of Michigan’s survey data, its reading for US consumer sentiment index ebbed off to 76.2 during the first half of February, largely hoisted down by the households with annual incomes below $75,000, while the figure was down from a January reading of 79.0.
Nonetheless, an analysts’ poll had forecasted a reading of 80.8. Aside from that, latest US Consumer Sentiment data from the University of Michigan that flabbergasted many economists and analysts, came forth weeks after the US Senate had passed an approximated $892 billion in pandemic stimulus bill, while the US President Joe Biden has been pushing forth towards a $1.9 trillion pandemic stimulus bill as early as by mid-March.
Meanwhile, addressing to a “K-shaped recovery” theory where better-earners perform well, leaving behind a large chuck of low-income households, a chief economic advisor at Brean Capital in New York, John Ryding said, “The decline in confidence is a bit of a surprise since it was driven by the outlook.
It appears ... (to) be another page in the tale of two economies or K-shaped recovery theme. ”