According to new information on the morning of November 10, the U.S. Senate may soon vote to approve a budget deal to end the government shutdown…
The unprecedentedly long shutdown of the U.S. government has made many Americans more pessimistic about the country’s economic outlook. The University of Michigan’s consumer sentiment survey, released last Friday, showed a sharp decline in sentiment.
The November survey index fell to 50.3 points, down from 53.6 in October, marking the lowest level since June 2022’s reading of 50, which was the lowest since this monthly survey began in the 1950s.
“The government has been shut down for over a month, and consumers are expressing concerns about its potential negative impact on the economy,” said Joanne Hsu, director of the University of Michigan’s consumer survey, in a statement.
Compared to October, the consumer sentiment index dropped 6.2%, and compared to the same period last year, it plunged 29.9%, completely contrary to analysts’ expectations. In a FactSet survey, economists had expected a slight improvement in U.S. consumer confidence in November.
“Looking at the consumer sentiment index alone, it seems the economy is about to fall into a big hole,” commented Chris Rupkey, chief economist at FwdBonds.
Hsu emphasized that the surge in pessimism was recorded broadly across all age groups, income levels, and political affiliations. The only exception was among consumers with heavy investments in the stock market, whose sentiment rose 11% from the previous month as U.S. stocks hovered near record highs.
Thomas Simmons, chief economist at Jefferies, noted in a report that this group of consumers plays a particularly important role in the U.S. economy because they “have the greatest influence on total consumer spending.” He said that their optimism would determine the overall resilience of the U.S. economy.
“However, the middle group is also very important — and their sentiment is deteriorating rapidly. If they can’t maintain their spending pace, consumer growth may no longer sustain its current momentum,” Simmons warned.
According to new information on the morning of November 10, sources told CNBC that the U.S. Senate may soon vote on a budget deal to end the government shutdown that has been in effect since October 1. The vote is expected to take place Sunday evening Washington D.C. time.
The source said that this temporary budget bill has secured enough support from Democratic senators to reach the minimum 60 votes required for passage. The bill would fund the U.S. government through the end of January.
If approved by the Senate, the deal would then need to be passed by the House of Representatives and signed into law by President Donald Trump before the government shutdown can officially end.
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