The overall level of consumer sentiment remained quite favorable in early March due to renewed strength in current economic conditions as well as the extraordinary influence of partisanship on economic prospects. The current economic conditions component reached its highest level since 2000, largely due to improved personal finances.
Overall, the University of Michigan’s Consumer Sentiment Index reports, the sentiment data has been characterized by rising optimism as well as by rising uncertainty due to a partisan divide. Optimism promotes discretionary spending, and uncertainty makes consumers more cautious spenders. This combination will result in uneven spending gains over time and across products.