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August 30, 2013

Thomson Reuters/University of Michigan: Consumer Confidence Reflects Economic Cross-Currents

ANN ARBOR. Consumer confidence eased in August after reaching its highest level in six years in the prior month. The small retrenchment still meant that the Sentiment Index was significantly higher than a year ago and still points toward increases in consumer spending during the year ahead. The cross-currents responsible for the small August decline are inevitable in a slow growth economy. Consumers were more optimistic about incomes increases during the year ahead than any other time in nearly five years, although they have become less certain about whether the economy would be strong enough to appreciably lower the unemployment rate in the year ahead. Perhaps the largest August change was that nearly two-thirds now expect interest rate increases during the year ahead.

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