Consumers worried about higher prices for homes and vehicles
The S&P 500 is trading flat while the Dow (-0.1%) has given up an early lead and has slipped into the laggard position.While the Treasury market continues to signal peak inflation rate expectations, consumers are worrying about higher prices for homes and vehicles. According to the preliminary UofM Index of Consumer Sentiment for June, spontaneous references to market prices for homes, vehicles, and household durables fell to their worst level since the all-time record in November 1974. The report elaborated that these unfavorable perceptions of market prices reduced overall buying attitudes for vehicles and homes to their lowest point since 1982. The survey's chief economist said a shift in the Fed's policy language could ease inflation expectations among consumers. On a related note, Reuters reported yesterday that a poll of economists revealed expectations that the Fed will likely announce a plan for tapering its asset purchases in either August or September.