Confidence in the economy stabilizes in late January, sentiment survey shows

Confidence in the economy stabilizes in late January, sentiment survey shows

The numbers: Americans were leery but hopeful in late January about the prospects of an economic renewal later in the year once coronavirus vaccines become widely available, a survey showed.

The second of two readings of consumer sentiment this month edged down to 79 from an initial 79.2, according to an index produced by the University of Michigan.

Economists polled by Dow Jones and The Wall Street Journal had forecast the index to remain at 79.2.

Yet the index was little changed from December’s reading of 80.7, suggesting that Americans are looking ahead instead of looking back.

Read: Consumer confidence rebounds on vaccine, Biden hopes

What happened: An index that measures how consumers feel about the economy right now slipped to 86.7 from an initial 87.7 and 90 in December.

Yet an index that measures consumer expectations for the next six months rose slightly to 74 from 73.8 earlier in the month (and 74.6 in December.)

The overall index is still more than 20 points below its precrisis peak, however.

Read: U.S. economy grew a slower 4% at end of 2020, GDP shows

Big picture: The economy is struggling right now after a record increase in coronavirus cases over the winter, but growth is likely to surge again later in the year if the vaccines are effective and the Biden administration makes good on promises to provide a massive infusion of federal aid.

Read: U.S. jobless claims drop to three-week low of 847,000

Market reaction: The Dow Jones Industrial Average

and S&P 500

fell in Friday trades.

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