Consumer sentiment highest since 2007

The survey found consumer attitudes on the economy improved by 1.7 percent in July from June. This climb represents a nearly 18 percent improvement since last July.

The confidence level stood at 85.1, up from 84.1 in July.  At the onset of the Great Recession, the number fell close to 50. A score above 100 would reflect a boom economy. 

“The July survey suggests a growing resilience among consumers that will enable them to more easily withstand the cross-current inevitable in a slow growth economy,” survey economist Richard Curtin said. 

The survey found feelings about current economic conditions improved by 5 percent while feelings about the future fell by 1.7 percent. Curtin said this likely reflects fears that interest rates will begin to rise at some point as the Federal Reserve’s easy money policy comes to an end. 

“Nonetheless, this was a robust sign that consumers expect the expansion to continue and act to speed up their buying plans,” Curtin said. 

It remains to be seen how consumers will react if, as expected, Washington becomes mired in a debt ceiling standoff this fall. The last standoff in 2011 led to a stock market selloff and contributed to a more than 20 point decline in the Michigan consumer sentiment survey.