Entity: Consumer Confidence Constitutes Economic Risk

BlockBeats News, March 14th—John Velis, a strategist at Mellon Bank in New York, stated that the drop in the University of Michigan Consumer Confidence Index was "discouraging." He said what is particularly worrying is the rise in long-term inflation expectations, as long-term inflation expectations had previously remained relatively stable. With the shake-up in consumer confidence, the weakening demand may begin to show in the real economy, a phenomenon that has already emerged in some industries such as air travel.

According to inflation data released this week, air travel prices saw a decline in February. Regarding consumer confidence surveys, Velis said: "Many cyclical pieces of evidence suggest these indicators are not great predictor[s], but you cannot ignore the overall decline and what lies beneath it." (FX678)