Floridians More Optimistic About U.S. Economy
UF’s June consumer sentiment saw an uptick to 69.3 from May’s 69.1, driven mainly by U.S. economic expectations. It’s the highest reading since Oct. 2021.
GAINESVILLE, Fla. – Consumer sentiment in Florida clicked up for a second consecutive month in June to 69.3, an increase of two-tenths of a point from a revised figure of 69.1 in May. Meanwhile, national consumer sentiment rose 5.2 points.
“The increase in June’s confidence is largely driven by Floridians’ anticipation of national economic conditions in the long run,” says Hector H. Sandoval, director of the Economic Analysis Program at UF’s (University of Florida) Bureau of Economic and Business Research. “Nevertheless, it is worth noting that Floridians’ views on discretionary spending intentions have been trending upward and have reached their highest level since October 2021.”
Among the five components that make up the index, three increases, one remained unchanged and one decreased.
Current conditions: Floridians’ June opinions about current economic conditions were mixed. Views of personal financial situations now compared with a year ago decreased 2.6 points from 64 to 61.4.
In contrast, opinions as to whether it’s a good time to purchase a major household item like an appliance increased slightly by four-tenths of a point from 61.9 to 62.3.
“The latest changes in consumers’ responses to whether now is a good time to buy a big-ticket item correspond with the easing of inflation in recent months, as well as the Fed’s unanimous decision to hold rates steady in mid-June,” says Sandoval. “The Fed typically combats inflation by raising rates, which results in tighter financial conditions, including higher borrowing costs. However, improved spending intentions indicate consumers are willing to increase their spending, which is a promising sign for the economy.”
Future expectations: Expectations of personal finances a year from now inched up four-tenths of a point, from 83.2 to 83.6, while expectations for U.S. economic conditions over the next year remained unchanged at 66.9.
However, the outlook for U.S. economic conditions over the next five years showed the greatest increase in June’s reading, rising by 3.3 points from 69.2 to 72.5 – and Sandoval says that outlook is shared by all subgroups of Floridians analyzed in the study.
“Looking ahead and considering the positive economic conditions in Florida, including a strong labor market and an unemployment rate holding steady at 2.6% since January 2023, we anticipate further gradual improvements in consumer sentiment,” Sandoval predicts.
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