A key gauge of US consumer sentiment eased in October from a six-month high, reflecting Americans’ “less favourable assessments” of their personal finances, data on Friday showed.

The University of Michigan’s survey of consumers’ preliminary reading for October slid to 99, missing expectations for a reading of 100.4, according to a survey by Thomson Reuters. That was down from a reading of 100.1 the previous month. However, the gauge remained above the 2018 average.

The survey of current economic conditions slipped to 114.4, while the consumer expectations index slid 1.5 per cent from the previous month to 89.1.

“Unfortunately, the downward revisions in the rate of growth in household incomes were accompanied by upward revisions in the year-ahead expected inflation rate, weakening real income expectations,” chief economist Richard Curtin, said.

The sell-off in markets only overlapped the survey period for one evening and therefore had “virtually no influence” on the data. The survey also did not reflect spillover from the Brett Kavanaugh hearings.

The report did however show that confidence in the government’s economic policies rose to its highest level in the past fifteen years in October and that much of the gain was due to an upward adjustment by Democrats, though their assessment was “still well below the much more favourable evaluations of Republicans”.

US consumer sentiment has been buoyed by strength in the labour market and the tax cuts implemented earlier this year. Strong consumer spending has also helped bolster GDP and investors are likely to keep a close eye on these data amid concerns the US economy is in the latter stages of the business cycle.

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