June 30 (UPI) -- The U.S. consumer is increasingly confident and optimistic that inflationary pressures will ease, though high prices remain a particular cause for concern, results from a University of Michigan survey showed.
The University of Michigan on Friday published its final results on consumer sentiment for June, showing an 8.8% increase in confidence from month-ago levels and a 28.8% increase from this time last year.
"Overall, this striking upswing reflects a recovery in attitudes generated by the early-month resolution of the debt ceiling crisis, along with more positive feelings over softening inflation," survey director Joanne Hsu said.
Broader markets were on edge from late May to early June as congressional Republicans held fast to their demands for future spending limits in a standoff over the debt ceiling.
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"Passing this budget agreement was critical," President Joe Biden said after the impasse ended in early June. "The stakes could not have been higher."
Year-on-year inflation to May, meanwhile, came in at 4%, well below the 9.1% level last summer. The May level, however, is twice as high as the target rate set by the Federal Reserve.
Survey results from the University of Michigan show consumers think inflation could fall to 3.3% in June, which would be the lowest reading since March 2021.
"Views of their own personal financial situation were unchanged, however, as persistent high prices and expenses continued to weigh on consumers," Hsu said.
The University of Michigan's survey results back sentiment found by The Conference Board earlier this week. Dana Peterson, the board's chief economist, said the U.S. consumer in June reported "sunnier views" on employment prospects in particular.
In terms of wages, about 30% of those taking part in the survey said they expected to be better off six months from now, compared with 14% who said they expected to be worse off.
"This might reflect consumers' belief that labor market conditions will remain favorable and that there will be further declines in inflation ahead," she said.
