Consumer sentiment in the United States rose to 102.4 for May, which is up from 97.2 in April. The findings smashed expectations but were recorded largely before the trade war escalated between China and the US.
New data from the University of Michigan’s consumer sentiment index shows that most Americans are upbeat about the economy and have optimistic expectations for its path in 2019. The index rose to 102.4 in May — far ahead of expectations of 97.5 by most economists. These are the highest levels recorded since 2004.
US-China Trade War Worries
However, some analysts warn that the recent escalation of the US-China trade war could hurt the current high levels of consumer confidence. The expected increase in prices may diminish the pace of consumer spending. This is why many analysts are claiming that, although consumer confidence is relatively high, it is surrounded by a political situation which is increasingly looking unhinged.
Just last week, the Trump administration raised tariffs to 25 percent on around $200B of Chinese goods. China responded by doing the same, in kind, on $60B worth of American goods. We will have to wait until the next installment of the index in June to determine whether or not this escalation will have an impact on consumer sentiments.
Bitcoin Rides High on Consumer Sentiment
There is evidence to suggest that Bitcoin (BTC) is benefiting significantly from the current boom in consumer confidence. Not only has new money been pouring into the market, but BTC is being rolled out at retail stores on a mass scale. Consumers will soon be able to spend bitcoins, Ethereum (ETH), and other major cryptocurrencies at many of the most popular retail stores.
Because Bitcoin is looking to position itself as an ultra-accessible investment for everyday consumers, it definitely feeds off high consumer confidence more than most traditional assets. A strong consumer base will ultimately be what propels the first and foremost cryptocurrency into being an integral component of the global economy.
If you’re a Bitcoin believer, follow consumer confidence levels closely. It is a valuable indicator of where we may expect the cryptocurrency market to go.
Do you believe consumer confidence has an impact on Bitcoin’s price movements and adoption? Let us know your thoughts in the comments below.
Images courtesy of The University of Michigan, Shutterstock.
[Disclaimer: The contents of this article are not intended as financial advice and should not be taken as such.]