Inflation expectations fall, but group differentiation intensifies. US consumer confidence in February rises less than expected.

Consumer confidence in the United States saw a slight increase in February, but the magnitude of the increase was lower than market expectations, reflecting a divergence in sentiment among different income groups. The confidence of high-income individuals who benefited from the rise in the stock market improved, while consumers who did not share in the gains from rising asset prices continued to feel pressure. According to the final survey data released by the University of Michigan on Friday, the consumer confidence index rose slightly from 56.4 in January to 56.6 in February. The survey covered feedback from respondents between January 20 and February 16. In comparison, the median expectation from a survey of economists was 57.3, indicating that the actual result was below market expectations. In terms of inflation expectations, consumers' expectations for price increases in the next year dropped to 3.4%, significantly lower than 4% in January, marking the lowest level in a year. The expectations for annual inflation in the next 5 to 10 years were 3.3%. This suggests that short-term inflation concerns have eased somewhat, but long-term price pressures have not completely dissipated. Joanne Hsu, director of the University of Michigan Consumer Surveys, stated in a declaration that consumers with better income and asset conditions have stronger resistance to potential economic risks due to stronger income prospects and more stable investment portfolios. In contrast, the confidence of other groups is constrained by high prices and living costs. Although consumer confidence has seen some improvement in recent months, the overall level is still significantly lower than the peak before the economic slowdown in 2024. Prior to this, high levels of inflation and cooling labor market conditions continued to weigh on consumer sentiment. However, recent macroeconomic data show some signs of stabilization. U.S. job growth has been stronger than expected, with the unemployment rate falling to 4.3% in January; at the same time, early-year inflation data also outperformed the market's pessimistic expectations. Analysts believe that if these trends continue, consumer confidence is likely to receive further support in the coming months. The minutes of the Federal Reserve's monetary policy meeting on January 27-28, released earlier this week, showed that most officials believed that signs of weakness in the labor market last year had eased by late January, but inflation risks still existed. Joanne Hsu also pointed out that 46% of consumers mentioned in the survey that high prices were eroding their personal financial situation, and issues of tariffs are still a highly concerning topic for consumers. Looking at the sub-indices, the index measuring current economic conditions rose from 55.4 in January to 56.6, while the index reflecting future expectations fell from 57 to 56.6. Overall, consumers' perceptions of their current financial situation improved slightly, but their confidence in the future declined, highlighting the uneven nature of the repair process in American consumer sentiment.