US consumers show the Fed its backward problem with high rates: Morning Brief
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US consumers felt more confident in May, according to data from the Conference Board. The main driver of this reading is the high rates that are helping the wealthiest Americans, making it difficult for the Federal Reserve to enact rate cuts. Wealthy households can earn upwards of 4.5% in a high-yield savings account and see their equity portfolios go up 20% in a year. The spending from wealthy consumers is also keeping overall inflation above the Fed's 2% target. A recent poll showed that 56% of respondents believe the US economy is currently in recession, despite economic data showing the opposite. The poll also showed that 49% of respondents think the S&P 500 is down this year, when it is actually up over 11%. The rise in consumer confidence in May was likely fueled by easing gas prices and rising equity prices, but the underlying details of the survey reveal that consumer confidence may be easily shaken moving forward. The perceived likelihood of a recession rose in May, worry over current and future financial situations worsened, and purchasing plans for homes remained at their lowest level since August 2012, reflecting the impact of higher interest rates.
#UsConsumers #FederalReserve #InterestRates #WealthyAmericans #EconomicGrowth #Inflation #ConsumerConfidence #Recession #S&p500
https://finance.yahoo.com/news/us-consumers-show-the-fed-its-backward-problem-with-high-rates-morning-brief-100047960.html
Yahoo Finance /
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2024-05-29 12:58:31
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npub1j0e6zhr82q4par2f4ecr67zvj0ltv8qgqr8v3llw2ed6qvdrm4fs9s3yhdPublished at
2024-05-29 12:58:31Event JSON
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"content": "US consumers show the Fed its backward problem with high rates: Morning Brief\n==========\n\nUS consumers felt more confident in May, according to data from the Conference Board. The main driver of this reading is the high rates that are helping the wealthiest Americans, making it difficult for the Federal Reserve to enact rate cuts. Wealthy households can earn upwards of 4.5% in a high-yield savings account and see their equity portfolios go up 20% in a year. The spending from wealthy consumers is also keeping overall inflation above the Fed's 2% target. A recent poll showed that 56% of respondents believe the US economy is currently in recession, despite economic data showing the opposite. The poll also showed that 49% of respondents think the S\u0026P 500 is down this year, when it is actually up over 11%. The rise in consumer confidence in May was likely fueled by easing gas prices and rising equity prices, but the underlying details of the survey reveal that consumer confidence may be easily shaken moving forward. The perceived likelihood of a recession rose in May, worry over current and future financial situations worsened, and purchasing plans for homes remained at their lowest level since August 2012, reflecting the impact of higher interest rates.\n\n#UsConsumers #FederalReserve #InterestRates #WealthyAmericans #EconomicGrowth #Inflation #ConsumerConfidence #Recession #S\u0026p500\n\nhttps://finance.yahoo.com/news/us-consumers-show-the-fed-its-backward-problem-with-high-rates-morning-brief-100047960.html",
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