From U.Michigan, preliminary results for September:
Figure 1: U.Michigan Consumer Sentiment, adjusted using Cummings-Tedeschi correction (blue, left scale), expected 1 year inflation, % (brown, right scale). Red dashed line at “Liberation Day”, purple dashed line at US-Iran war. Source: U.Michigan, Cummings and Tedeschi (2024), author’s calculations.
After incorporating the Cummings-Tedeschi adjustment, the Michigan survey lies between the Conference Board and Gallup measures (standardized).
Figure 2: U.Michigan Economic Sentiment, using Cummings Tedeschi adjustment (blue), Conference Board Confidence Index (brown), Gallup Confidence (green), all demeaned and divided by standard deviation 2021M01-2025m02. Red dashed line at “Liberation Day”, purple dashed line at US-Iran war. Source: UMichigan, Gallup, Conference Board, Cummings and Tedeschi (2024), and author’s calculations.
That being said, it looks like sentiment/confidence is continuing to trace the downward trend shown in August’s numbers.
Remember when Scott Bessent said that oil will drop significantly because the Strait of Hormuz will be bypassed in two years as oil starts moving through overland pipelines. It looks like Iran has put that lie to the test and forced the closure of Saudi Arabia’s East-West pipeline. Saudi Arabia’s oil exports slumped to just about 3 million barrels a day in August, the lowest in records going back to early 2017, as ships came under attack in the Red Sea from Houthi militants.
In other news – Iranian President Masoud Pezeshkian is attending the BRICS summit in New Delhi, India. Remember when Trump said he was going to isolate the BRICS countries. However, the U.S. is becoming more isolated as Trump cuts off our allies. The Trump admin/GOP has been an utter failure at governance. ¯\_(ツ)_/¯