US: University of Michigan’s consumer sentiment likely to print 97.6 in the final reading - Nomura

Analysts at Nomura note that in the preliminary report for March, Michigan consumer sentiment increased to 97.6 from 96.3, close to the post-recession high of 98.5 in January 2015 while consensus expects an elevated reading of 97.6 for the final reading.

Key Quotes

“The partisan divide continued in this report. Self-identified Democrats continue to show strong pessimism about future conditions, while Republicans remain highly optimistic. Considering this partisan tinge in consumer expectations, it is likely that both ends of the spectrum will eventually converge.”

“The median of consumers’ 5- to 10-year inflation expectations was at 2.2% in the preliminary reading, marking a survey low, and down from 2.5% in February. While the monthly measure can be rather volatile, it will be interesting to see if the final reading for March remains this low.”