U.S. Consumer Sentiment Downwardly Revised Amid Stock Sell-Off

(RTTNews) - Potentially reflecting the recent sell-off on Wall Street, the University of Michigan released a report on Friday showing a bigger than previously estimated drop in U.S. consumer sentiment in the month of August.

The report said the final reading on the consumer sentiment index for August came in at 91.9 compared to the preliminary reading of 92.9. The index is down from 93.1 in July.

The downward revision came as a surprise to economists, who had expected the index to be upwardly revised to 93.0.

Richard Curtin, the survey's chief economist, said, "The Black Mondays of October 17, 1987 and August 24, 2015 represent two episodes when the stock market declined mainly due to reasons other than the domestic economy."

"Consumers quickly dismissed the 1987 episode since it didn't involve their jobs or incomes, and today's consumers hold similar favorable views about their job and income prospects," he added.

Curtin said there is every reason to expect continued growth but cautioned that consumer sentiment must be carefully monitored in the months ahead.

The report showed a notable downward revision to the current economic conditions index for August, which was lowered to 105.1 from 107.1 and compares to 107.2 in July

The index of consumer expectations was also downwardly revised to 83.4 from 83.8 and is below the 84.1 recorded in the previous month.

The report also said one-year inflation expectations held steady at 2.8 percent, while five-to-ten-year inflation expectations slipped a tenth of a percentage point to 2.7 percent.