Consumer Sentiment in the Spotlight as Michigan Survey Set for Release

The University of Michigan will publish the October preliminary results of its widely followed consumer sentiment survey at 10:00 a.m. EDT this morning. After September’s final reading of 48.1 proved the second-lowest ever, the consensus mood forecast is sort of like a playlist of Lana Del Rey and Morrissey songs.

But new sales figures from Costco and a more specific survey of consumers’ personal well-being are singing a happier tune.

Kirkland-Sized Pantry Food for a K-Shaped Economy

Household spending rose 6.1% year over year in August, and growth has mostly accelerated since falling to 4.3% in December 2025, according to U.S. Bureau of Economic Analysis data. Considering that consumer spending is more than two-thirds of the US economy, you won’t need to consult the works of Paul Samuelson and Milton Friedman to appreciate why the bureau revised its reading of second-quarter GDP growth to 2.2% from 1.5%.

The evidence is piling up. Costco reported Wednesday that comparable US sales, factoring out gas prices, rose at an annualized 8% pace in September, compared to 5% one year ago. It marked a step up from July and August, when comparable US sales grew just 6.6% and 5.4%, respectively, after reaching nearly 9% in the late spring. Net sales in September rose 13% to $30 billion. Costco, the nation’s third-largest retailer after Walmart and Amazon, is considered a bellwether for middle-income consumers and suburban bulk buyers. Spending has also kept up at Walmart, which reported better than expected 5.9% revenue growth to $187.9 billion in the second quarter, representing lower-income spending.

One key factor sustaining consumers got a boost Thursday. The Labor Department reported weekly jobless claims fell 2,000 to 197,000 last week, keeping them near the lowest levels in half a century. “Job growth is trending above the pace needed to keep up with new entrants to the workforce,” said Bill Adams, the chief economist at Fifth Third Commercial Bank. “If current trends hold, the unemployment rate should reverse September’s increase and edge lower in coming months.” 

Of course, all is not rosy — wage gains have been outpaced by inflation, leaving Americans with less room to save — but a stable labor market has provided income to spend. Meanwhile, some consumers have grown more optimistic:

• Deloitte said this week that its survey of consumers’ financial well-being held at 103.4 in August, eight points above where it was last year. Its index more narrowly tracks Americans’ feelings about their personal financial health and security than the Michigan Survey, which includes questions about the broader economy.
• Respondents told Deloitte they intend to spend more on both discretionary and nondiscretionary items, although naturally they expect prices to keep rising.

Snacking Slowdown: Not all US consumer sales are equal. While PepsiCo reported third-quarter net revenue rose 5.6% on Thursday, the company’s international business drove growth. Pepsi’s North American food volumes were flat, and its beverage volumes fell 2%. Time to patent ingestible GLP-1 Diet Mountain Dew.