Americans are more optimistic about the economy

The September consumer confidence index was 69, up 2% from the previous month and 40% from the record low of June 2022 – when US inflation peaked. However, this index is still lower than before the pandemic.

“Consumer confidence has increased for two consecutive months, the highest level in the past four months. The main reason is that consumers find prices more affordable, especially for big-ticket items such as cars and furniture,” said Joanne Hsu, head of consumer surveys at the University of Michigan.

Americans are also more optimistic about inflation next year. The average inflation forecast for next year fell for the fourth consecutive month, to 2.7%. This is the lowest level since December 2020.

The poll also found that “more and more Democrats and Republicans are predicting a victory for Vice President Kamala Harris” in the November election. The first televised debate between former President Donald Trump and Harris took place last week. Trump declined to debate Harris a second time.

These latest numbers could help Harris. The economy is a dominant issue this election, from housing prices to inflation. It was the first topic of discussion in last week’s debate, so how the economy plays out between now and early November could influence voters’ decisions.

In August, the US consumer price index (CPI) increased by 2.5%, down significantly from its peak of 9% in the same period in 2022. The personal expenditures index (PCE) – the Fed’s preferred inflation measure – has also shown signs of cooling over the past two years. Compared to 2022, prices have decreased significantly in many areas, especially gasoline. This product plays an important role in shaping people’s price psychology.

“If consumers focus on price increases over the past four years, Trump has the advantage. But if you look at the process of the US bringing inflation to 2% – the Fed’s target – Ms. Harris has the advantage,” Ryan Sweet, chief economist at Oxford Economics, said on CNN.