Consumer Sentiment Slides for Third-Straight Month -- Update

By FeaturesDow Jones Newswires

A measure of U.S. consumer sentiment slid in January for the third-straight month, continuing to ease after reaching its highest level in more than a decade.

The University of Michigan on Friday said its consumer sentiment index was 94.4 in early January, down slightly from 95.9 in December. It dropped in December and November after hitting the highest level since 2004 in October.

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Economists surveyed by The Wall Street Journal had expected a preliminary reading of 97.0 for January. A final reading for January will be released Feb. 2.

Consumers have been upbeat this year in multiple measures, buoyed by strong economic growth, low unemployment, and rising wealth related to property values and repeated stock market highs. Still, consumers viewed economic conditions less favorably this month.

"This small decrease in current conditions produced a small overall decline," said Richard Curtin, the survey's chief economist. "Importantly, the survey recorded persistent strength in personal finances and buying plans."

The consumers' expectations portion of the survey moved up only slightly despite the fact that most respondents who mentioned the recently-passed tax overhaul thought its impact would be positive. This disconnect largely occurred because of uncertainties about the longer-term impact of the changes on consumers, Mr. Curtin said.

"Some of the uncertainty is related to how much a cut or an increase people, especially high income households who live in high-tax states, face," he said.

Friday's report also showed household expectations about long-term rising prices remained at its 2017 average, but inflation expectations over the next year inched up slightly to 2.8% in January from 2.7% in December.

Write to Sharon Nunn at sharon.nunn@wsj.com

(END) Dow Jones Newswires

January 19, 2018 11:02 ET (16:02 GMT)

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