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U.S. Consumer Sentiment Drops Less Than Initially Estimated In February

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Revised data released by the University of Michigan on Friday showed U.S. consumer sentiment deteriorated by slightly less than initially estimated in the month of February.

The report showed the consumer sentiment index for February was upwardly revised to 76.8 from the initial estimate of 76.2.

The revised reading came in above economist estimates of 76.5 but was still below the final January reading of 79.0.

"All of February's loss was due to households with incomes below $75,000, with the declines mainly concentrated in future economic prospects," said Surveys of Consumers chief economist Richard Curtin.

He added, "The worst of the pandemic may be nearing its end, but few consumers anticipate the type of persistent and robust economic growth that restores employment conditions to the very positive pre-pandemic levels."

The report showed the index of consumer expectations slid to 70.7 in February from 74.0 in January, while the current economic conditions index edged down to 86.2 from 86.7.

On the inflation front, one-year inflation expected jumped to 3.3 percent in February from 3.0 percent in January. Five-year inflation expectations were unchanged at 2.7 percent.

"While consumers clearly anticipate a spurt in inflation in the year ahead, the overall evidence does not indicate the emergence of an inflationary psychology that makes the expectation of inflation a self-fulfilling prophecy," Curtin said.

Meanwhile, a report released by the Conference Board on Tuesday showed consumer confidence in the U.S. improved more than expected in the month of February.

The Conference Board said its consumer confidence index rose to 91.3 in February from a downwardly revised 88.9 in January.

Economists had expected the consumer confidence index to inch up to 90.0 from the 89.3 originally reported for the previous month.

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