U.S. Consumer Sentiment Takes Surprise Tumble
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U.S. consumer sentiment took an expected tumble this month after hitting a six-year high in July, according to a survey released today. The Thomson Reuters/University of Michigan's preliminary reading on consumer sentiment dropped to 80.0 from 85.1 last month, the lowest reading in four months.
The decline came as a surprise. Forecasts had expected index to show an increase in the reading to 85.3 or 85.5, either of which would have been a new six-year high.
According to a statement obtained by Reuters, survey director Richard Curtin said that consumers still expect the economy to continuing growing, though at a slower rate than before.
"Perhaps the most important recent changes have been the increase in home values as well as the jump in the numbers that expect interest rate increases during the year ahead," Curtin said, according to Reuters.
Another crucial economic report released today revealed that housing starts and permits issued for building projects both rose in July, but missed economists' estimates, according to a report released Friday by the U.S. Department of Commerce.
Housing starts rose to a seasonally adjusted annual rate of 896,000 units – nearly six percent higher than the June estimate of 846,000 units and more than 20 percent higher than July of last year – but below estimates of a 900,000-unit rate. Permits increased by 2.7 percent since June, reaching a seasonally adjusted annual rate of 943,000 units. The results came in just shy of the 945,000-unit rate economists were expecting.