The numbers: Consumer sentiment improved slightly at the end of October, but higher gas prices left people more worried about inflation.
The final reading of the sentiment survey edged up to 63.8 from 63.0 earlier in the month, the University of Michigan said Friday.
The index had touched a nearly two-year high in July before retreating. A sharp decline recently in the stock market has added to consumer angst.
The consumer-sentiment survey reveals how consumers feel about their own finances as well as the broader economy.
Key details: A gauge that measures what consumers think about the current state of the economy rose to 70.6 from 66.7 in early October.
Yet a measurement of expectations for the next six months slipped to 59.3 from a preliminary 60.7.
Americans think inflation will average 4.2% in the next year, compared with 3.8% earlier in the month and 3.2% in September. Renewed worries about inflation largely reflect higher gas prices.
The official rate of inflation is 3.7%, using the consumer-price index.
Big picture: The economy is still growing strongly despite stubbornly high inflation and rising interest rates. Growth in the third quarter was the strongest in almost 10 years, excluding the pandemic years of 2020-2021.
The chief reason? A strong labor market and the lowest unemployment rate in decades. Americans feel confident enough to keep spending because they feel secure in their jobs.
Looking ahead: The soft consumer-sentiment reading reflects “ongoing concerns about inflation and, to a lesser degree, uncertainty over the implications of negative news both domestically and abroad,” said Joanne Hsu, director of the survey.
Market reaction: The Dow Jones Industrial Average
DJIA,
fell but the S&P 500
SPX,
rose in Friday trading.
