Consumer sentiment rebounded in early November after dropping to a two-year low in the prior month, according to the University of Michigan’s monthly survey.
The index of consumer sentiment jumped to 91.6 from 87.2, more than economists had forecast.
“The recent gain in sentiment was driven by an improved outlook for the economy,” said Richard Curtin, the survey’s chief economist.
But the caveat, “unfortunately,” was that data for this report was collected before the presidential election. In recent months, some consumers said uncertainty over who would become president made them anxious about the economy going forward.
“The most striking finding in early November was that both near and long-term inflation expectations jumped to 2.7% from last month’s record matching lows of 2.4%,” Curtin said.
This rise in inflation expectations was added justification for the interest-rate hike expected from the Federal Reserve in December, according to Curtin.