Consumer sentiment data from the University of Michigan:
- Prior was 98.4
- Current conditions 107.4 vs 110.7 prior (lowest since 2016)
- Expectations 82.3 vs 90.5 prior
- 1-year inflation 2.7%
- 5-10 year inflation 2.6% vs 2.5%
That's not a great sign. The consumer has been extremely strong this year but this is a forward-looking indicator and it shows that trade worries could be weighing.
"The main takeaway for consumers from the first cut in interest rates in a decade was to increase apprehensions about a possible recession. Consumers concluded, following the Fed's lead, that they may need to reduce spending in anticipation of a potential recession.," the report said. " It is likely that consumers will reduce their pace of spending while keeping the economy out of recession at least through mid 2020."