Consumer sentiment among Floridians rose 1.3 points to 73.3 in April from the revised 72 in March. Conversely, national sentiment fell by 2.2 points.
“The rise in consumer confidence is due to Floridians' positive views on the country's economic outlook. Specifically, expectations for the U.S. economy over the next five years have reached levels not seen since July 2021. The timing coincides with the rise in inflationary pressures that began in the second quarter of 2021. However, these price increases were not initially considered to be of concern. It jumped from 1.9% to 4.8% from the first quarter to the second quarter, and reached 5.3% in the third quarter, before the Fed began its most aggressive tightening cycle in decades by raising interest rates. It wasn't until 2022. We need to get interest rates under control,” said Hector H. Sandoval, director of the economic analysis program at the university's Office of Economics and Business Research.
Of the five components that make up the index, four rose and one fell.
Floridians' opinions about the current economic situation improved in April. Individuals' current views on their financial situation increased by 1.4 points from 59.8 to 61.2 compared to a year ago. Opinions varied by demographic, however, with people under 60 and those earning less than $50,000 a year being less favorable. Opinions about whether now is a good time to buy big-ticket items such as refrigerators, cars, and furniture rose one point from 62.9 to 63.9. Opinions were similarly divided by demographics, with women, people over 60, and people making less than $50,000 a year expressing more pessimistic views.
Future economic outlook was mixed in April. On the other hand, expectations for individual household finances one year from now fell 1.1 points from 83.7 to 82.6. However, men and people over 60 reported more positive expectations. Meanwhile, the outlook for the country's economy was more optimistic. Expectations for the US economic situation over the next 12 months rose 2.9 points from 73.3 to 76.2, and views on the US economic situation for the next five years rose 2.1 points from 80.5 to 82.6. Remarkably, these expectations were shared by all Floridians except those with annual incomes of less than $50,000, who reported less favorable views on the latter factor.
“Economic growth remained positive in the first quarter of this year, at an annualized rate of 1.6%, due to increased consumer spending on a strong labor market and rising levels of consumer confidence. However, the Fed's efforts to curb inflation Nevertheless, inflation rose over the same period, according to the latest inflation data from both the Federal Reserve's preferred inflation measure, the Department of Labor's Consumer Price Index (CPI) and the Department of Commerce's Personal Consumption Expenditures (PCE) Price Index. , suggesting a possible trend reversal in March,” Sandoval said.
“Looking forward, this reversal is likely to deter the Fed from cutting rates in the summer, as previously expected. Additionally, it could lead to a decline in consumer confidence, leading to potential “This could further exacerbate the risk of a recession and undermine expectations of lower inflation without a recession,” Sandoval added.
The UF survey, conducted from March 1 to April 25, included 250 people contacted by cell phone, 293 people contacted through an online panel, and a representative cross-section of Florida's demographics. Reflects a total of 543 responses. The index used by University of Florida researchers is based on 1966, with a value of 100 representing the same level of confidence for that year. The minimum possible index is 2 and the maximum is 150.
More information about this month's survey can be found at https://www.bebr.ufl.edu/florida-consumer-sentiment/.
Elizabeth Lynch April 30, 2024
