The numbers: Stimulating tests, rising coronavirus vaccinations, and a rapidly growing economy lifted American morale in early April and pushed up a closely watched survey of consumer attitudes. the highest level in 13 months.
According to a preliminary survey by the University of Michigan, the consumer sentiment index rose to 86.5 in April from 84.9 in the previous month.
That is the highest level since the pandemic broke out in the US in March 2020. The index hit a 16-year high of 101 just a month earlier.
What happened: Americans’ attitudes about their personal finances and the current broader economy also climbed to a 13-month high.
The so-called current conditions index rose to 97.2 from 93 in March.
However, a forward-looking measure of what consumers expect six months from now, shows lingering anxiety about the pandemic, including the safety of the coronavirus vaccine. The index was unchanged at 79.7.
The US government stopped Johnson & Johnson’s single-dose vaccine after blood clots were reported in a small number of patients.
Also causing American concern is higher inflation. Consumers tend to see a change in initial inflation through the rise in gasoline prices, which have risen sharply since the end of last year.
Consumers expect the inflation rate, currently at 2.6%, will rise to as high as 3.7%. The last time they expected such relatively high inflation was a decade ago.
However, like senior Federal Reserve officials, consumers expect inflation to subside over a longer period of time.
On the brighter side, half of all surveys predict a drop in unemployment. That was the highest percentage ever recorded, the University of Michigan said.
Big picture: The United States is rebounding sharply as stimulus flows into the economy, governments loosen pandemic restrictions and businesses seek to hire in anticipation of strong sales in the coming months. .
The government on Thursday reported US retail sales rose 10% in March while jobless claims fell by nearly 200,000 to their new pandemic low of 576,000.
MarketWatch Specials: The coronavirus pandemic has reshaped our working lives, and that’s fair.
The only obstacle to growth? Another spike in coronavirus cases. The number of people infected with the virus is no longer decreasing, but it has not increased much.
As long as the virus is contained, the economy will continue to build momentum.
Market reaction: Dow Jones industrial average
and S&P 500
increase in Friday transactions.