Americans are beginning to feel somewhat more optimistic about the economy as lower gasoline prices and easing tensions between the U.S. and Iran improve consumer confidence, The New York Times reports.
According to the University of Michigan’s long-running consumer sentiment survey, the index rose to 49.5 in June from 44.8 in May, marking a rebound after several months of declining confidence.
The improvement was seen across income levels, wealth groups and political affiliations, suggesting that the shift in outlook was broad-based. Economists attribute much of the increase to falling gasoline prices following the June 15 U.S.-Iran memorandum of understanding, although fuel costs remain relatively high compared with historical norms.
Despite the recent gains, consumer sentiment remains well below earlier levels, standing 13% lower than before the Iran conflict began and nearly 20% below where it was a year ago.
Inflation continues to be the primary concern for many households. More than half of respondents say that high prices are straining their personal finances, and many report changing their spending habits by traveling less, staying home more often or cutting back on discretionary purchases.
The latest Consumer Price Index showed prices rising 4.2% over the past year, with energy prices increasing 23.5% and food prices climbing 2.7%.
While easing geopolitical tensions and lower fuel prices have provided some relief, many Americans remain concerned about the overall cost of living and the uncertainty surrounding the economy.
The New York Times has the full story.
