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Fla.’s Consumer Confidence Down a Bit in Sept.

A 1.2-point drop to 66.3 was “not unexpected,” since Hurricane Idalia hit in Sept., say UF researchers – and “current finances” fell more than future expectations.

GAINESVILLE, Fla. – Consumer sentiment in Florida dropped 1.2 points in September to 66.3, down from a revised figure of 67.5 in August. Nationally, sentiment declined 1.4 points.

“The decline in September is not unexpected, as this month’s reading reflects the impact of Hurricane Idalia, which made landfall on Aug. 30 in Florida’s Big Bend region, resulting in business closures, agricultural production losses and property damage,” says Hector H. Sandoval, director of the Economic Analysis Program at UF’s Bureau of Economic and Business Research.

“These economic disruptions are not expected to have a lasting effect on the economy and consumer sentiment, as the impact of such disasters on consumer sentiment, in particular, tends to be short-lived,” Sandoval adds.

Both short-term and long-term attitudes create the full index, and Sandoval says the September reading “was largely fueled by Floridians’ views about their personal financial situation now compared with a year ago, which plummeted sharply in September. However, the effect of this drop on the overall index was muted by the changes in the other four components.”

Among five components that make up the index, two showed increases, one remained unchanged and two decreased.

Current economic conditions

Floridians had mixed opinions about current economic conditions. Views of personal financial situations compared with a year ago showed the steepest decline in September, plummeting 7.1 points from 63.2 to 56.1 – the largest month-to-month change recorded in since the pandemic hit in April 2020.

On the other hand, opinions on whether now is a good time to purchase major household items, such as appliances, increased only slightly – eight-tenths of a point from 55.5 to 56.3.

Future economic conditions

Floridians’ opinions about future economic conditions were also mixed. Expectations of personal finances a year from were unchanged at 79.9, while expectations about U.S. economic conditions over the next year dropped four-tenths of a point from 67.4 to 67.

Still, the longer-term future appears rosier, at least in Floridian’s minds. Expectations about U.S. economic conditions over the next five years rose seven-tenths of a point from 71.4 to 72.1.

Floridian’s opinions were consistently split by demographics for both short-term and long-term future expectations. Men, people younger than 60, and people with an annual income above $50,000 expressed more pessimistic views across both components. On the flipside, women, people 60 and older, and people with an income below $50,000 expressed more positive views.

“Over the past three months, oil prices have continued to rise. This not only challenges the Fed’s battle against inflation but also burdens consumers who will face higher gasoline prices, putting a strain on their budgets,” says Sandoval. “The higher borrowing costs resulting from the Fed’s aggressive rate hikes, along with the ongoing elevated inflation in some parts of Florida and the rising oil prices, are likely factors contributing to Floridians’ pessimistic views regarding their personal financial situations now compared with a year ago.”

Overall, Florida’s consumer sentiment index has changed little over the past six months, alternately rising slightly and then falling.

As a result, Florida consumer sentiment for 2023 is “currently on track to be one of the top three most depressed years since records became available in 1985,” says Sandoval. “Looking ahead, we anticipate that consumer sentiment will continue to remain low in the months ahead.”

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