The Michigan sentiment report
The Michigan sentiment report revealed an October climb to a sturdy 96.0 from 93.2 in September and a 3-year low of 89.8 in August, versus a 14-year high of 101.4 in March of 2018. Today's pop, despite recent declines in other "soft data" measures, extends the pattern of erratic volatility for these surveys that analysts attribute to divergent interpretations of what has been a volatile news flow this year. Today's Michigan sentiment gain defied the downdraft expected from the UAW-GM strike, which is likely impacting a growing pool of workers along the auto corridor. Fortunately, the path for consumption has remained firm in 2019 despite gyrations in the various confidence metrics. Today's inflation expectations measures were particularly weak, with a drop in the 1-year measure to a 2.5% level last seen in April from 2.8% in September, and a drop in the 5-10 year inflation index to a 2.2% new all-time low from 2.4%, versus a 2.3% prior all-time low in June, April, and February of this year, and earlier in December of 2016. For other October surveys, the IBD/TIPP index rose to 52.6 from a 7-month low of 50.8. The weekly Bloomberg Consumer Comfort index rose to 62.7 in the first week of October from 62.0, leaving the measure above the September average of 62.4. Consumer confidence is expected to bounce to 128.0 in October from a 6-month low of 125.1 in September.