Analyst: Consumer confidence surveys have a soothing effect on monetary policy

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Golden Finance reported that on July 17, Samuel Tombs of Pantheon said the rise in the University of Michigan consumer confidence index is still below last year’s average level. The indicator increased from 49.5 in June to 54.4, exceeding economists’ expectations of 50.5. Tombs noted that falling inflation expectations gives the Federal Reserve some comfort. “To be sure, Chairman Wosh may be a little disappointed, because his hawkish comments on inflation have not further pushed down expectations,” he said. But Tombs said that workers’ “lack of leverage” means it is “unlikely that wage growth will rise due to the recent overall rebound in inflation.”
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