U.S. consumer sentiment continued to improve in late September on a pickup in optimism for the economic rebound, though the gauge still remains below pre-pandemic levels.
The University of Michigan’s final sentiment index rose to 80.4, firmer than the preliminary reading of 78.9 and following 74.1 in August, data released Friday showed. The median estimate from economists surveyed by Bloomberg was for a slight increase to 79.
The measure of expectations jumped 7.1 points to 75.6 from a month earlier, while a gauge of current conditions rose 4.9 points from August to 87.8.
The increase in consumer sentiment reflects more Americans embracing a positive economic outlook and the potential for faster growth. The gauge still remains below pre-pandemic levels, which could point to concern about the path of the recovery.
“While consumers have anticipated gains in the national economy ever since the April shutdown, the September survey recorded a significant increase in the proportion that expected a reestablishment of good times financially in the economy,’’ Richard Curtin, director of the survey, said in a statement. Still, the improvement was largely driven by optimism among upper-income households, he said.
A separate report earlier Friday showed that employment gains cooled in September. Another release Thursday showed that the slow labor-market recovery continues, with initial jobless claims decreasing modestly last week.
Still, additional fiscal stimulus has remained elusive and it is unclear whether additional support will materialize before the presidential election. Americans’ outlook on the economy will likely play a role in who comes out on top in the vote next month.
Sentiment among both Democrats and political independents rose more in September than for Republicans, though optimism for the latter voting bloc remains higher.
The Michigan survey was conducted Aug. 26 through Sept. 28.
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