US consumer long-term inflation expectations continued to decline in September, Chicago PMI fell below boom and bust line | Anue Juheng-US Stocks

According to data released by the University of Michigan on Friday (30th), consumer confidence in September increased slightly from the previous month, and consumers’ long-term inflation expectations have hit a new low since April 2021, but short-term inflation expectations have climbed . But it is still at its lowest level for a year. In addition, the Chicago Purchasing Managers Index (PMI) released on the same day fell below the 50 boom and bust line to 45.7, well below market expectations and a new low in more than two years, meaning that the US economy is showing a red light.

Data released by the University of Michigan showed that the final value of the confidence index in September was 58.6, below market expectations and the initial value of 59.5, but slightly higher than the final value of 58.2 in August. In terms of other indices, it was reported that the final value of the current situation index was 59.7, a new high since May this year, better than the expected and initial value of 58.9, and the final value in August was 58.6; The final value for August was 58.

In terms of inflation expectations, which have attracted a lot of attention from the market, the final value of consumers’ long-term inflation expectations for 5 to 10 years in September fell further to 2.7%, the lowest since April 2021 and below the initial value. of 2.8% The final value of short-term inflation expectations for next year rose slightly to 4.7% from the initial value of 4.6%, but remained close to the lowest level for a year.

Falling energy prices but rising food prices have raised consumer uncertainty about near-term prices to a 40-year high. While lower oil prices have helped improve sentiment, consumer sentiment is still subdued by historic levels and showing signs of slowing. However, fuel prices show signs of rising again, while the Federal Reserve insists on fighting inflation, raising the possibility of a recession in the United States.

Inflation expectations are likely to remain relatively volatile in the coming months, as that uncertainty is unlikely to abate in the face of continued pressure on global inflation, said Joanne Hsu, director of the University of Michigan Consumer Confidence Survey.

The report also showed that most consumers expect their income to grow over the coming year, but only 16% expect their income to outpace inflation. In addition, consumer assessment of durable goods purchases improved in September, but remained near all-time lows.

Chicago’s PMI plunged to 45.7 in September, well below expectations

The Chicago business cock data released on the same day, that is the Chicago PMI commonly known by the market, plunged to 45.7, which was not only below the boom and bust line, but also much less than the 52.2 last month and the market’s expected 51.8, hitting a new low in more than two years, meaning the US economy is red-lighting.

The Chicago PMI is compiled jointly by ISM-Chicago and the MNI Chicago Business Barometer; and is the last to reflect regional manufacturing economic activity before the ISM manufacturing index for the US is released next Monday (October 3).

The market expects the US ISM manufacturing index to be released next Monday to be weaker, but still in expansion territory. In terms of details, the data price index, new orders and employment index may show moderate weakness, but the export orders index is expected to turn positive and return to a boom and bust line.

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