Consumer sentiment surged in May to its best level since 2004. The University of Michigan’s consumer sentiment index in May jumped to a reading of 102.4 from April’s 97.2. Economists had expected a more modest pickup to 97.5.
This is the third survey showing economic conditions improving in May, following the Philadelphia Fed manufacturing survey and the New York Fed’s Empire State survey.
The index for consumer expectations rocketed higher, rising to 96 from 87.4 in April. The current economic conditions ticked up a tenth of a point to 112.4.
“Consumers viewed prospects for the overall economy much more favorably, with the economic outlook for the near and longer term reaching their highest levels since 2004,” the survey’s chief economist Richard Curtin said in a statement.
The gains in sentiment were recorded mostly before the trade negotiations with China, according to Curtin. The end of the month’s survey will more fully reflect any impact from the escalation in the trade fight with China.