While consumer optimism is on the rise, actual consumer spending has taken a hit. The University of Michigan’s January 2017 consumer sentiment report showed an index score of 98.1. This is near a 12-year high and more than 10 points higher than the index showed in October 2016.
However, the Commerce Department reported that retail sales fell short of economists’ forecasts and department store sales decreased by 8.4 percent.
These figures indicate that consumer spending habits do not necessarily follow consumer confidence in the economy.
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