Consumer Sentiment Steady…For Now?
|Consumer sentiment remained resilient in February, though the cutoff of the survey likely missed any significant hit from coronavirus fears and flagging equity markets.
Growing Coronavirus Concern
- A weaker read on sentiment this morning would not have been a surprise, as coronavirus fears have swept financial markets. But consumers held their ground in February, with the final read on sentiment coming in at 101.0, a touch ahead of the preliminary 100.9 estimate. Only 8% of consumers mentioned the coronavirus, but 20% of those surveyed in the final two days of the survey, which ended February 25, mentioned it.
Sentiment May Stumble
- Underlying details of the survey were broadly positive. 58% of consumers reported improving finances in February, which is the highest level ever recorded. Depending on the virus’ spread and equity market reaction, however, there is significant risk that virus fears dampen sentiment. Consumers are sensitive to big stock market moves, and the recent ~14% selloff in equity markets is likely to manifest itself in the March survey
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