Today’s University of Michigan Consumer Sentiment survey showed that Americans are feeling terrific about the state of the economy. The index jumped to 98.0 in January from last month’s 91.7 level.
On a broader level, this is not an important piece of data for mortgage markets. The idea is that a more confident consumer will spend more money on goods and services and that will propel the economy forward. However, there is a no direct connection between how a person feels about the economy, and how they spend their own money. We only need to look at our own lives to figure that piece out.
More likely to roil markets today are speeches from Fed Presidents Lacker (Richmond) and Hoenig (Kansas City). With traders already on edge, they’ll be looking for Fed insight on inflation.