Consumer Sentiment Climbs for Fifth Consecutive Month in January
The University of Michigan/Thomson Reuters gauge of consumer sentiment rose in January for its fifth straight monthly gain as recent job growth has helped ease concerns over U.S. government finances and the debt crisis abroad.
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The index rose to 75.0 in January, compared to a preliminary report of 74.0 and a December reading of 69.9. The sentiment gauge, which covers how consumers view their personal finances as well as business and buying conditions, averaged about 87 in the year before the start of the recession.
Sentiment has been improving month over month since Standard & Poor’s downgraded the government’s top credit rating in August. Recent job growth has boosted sentiment, though the rate of unemployment in the U.S. is unlikely to drop considerably in the current month after falling to 8.5 percent in December.
“Although the current level of confidence has nearly regained its highest level since the recession, this is the third consecutive year that confidence has mounted a comparable rally,” said Richard Curtin, who is chief economist of the survey. But “all prior rallies failed when consumers concluded that the improvement they had anticipated had failed to materialize.”
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