Dive Brief:

• The University of Michigan’s Index of Consumer Sentiment climbed to 98.0 this month, largely due to consumers’ initial reactions to Donald Trump’s surprise victory in November's U.S. presidential election.

• The finding is not only just one-tenth of an Index point shy of last year's peak measure (itself the highest level since the start of 2004), but also well above the Thomson Reuters consensus estimate for 94.5 cited by CNBC. 

• "When asked what news they had heard of recent economic developments, more consumers spontaneously mentioned the expected positive impact of new economic policies than ever before recorded in the long history of the surveys," according to Surveys of Consumers Chief Economist Richard Curtin.

Dive Insight:

Earlier surveys from the University of Michigan recorded some anxiety on the part of consumers, half of whom as of October were anticipating an economic downtown in the next five years. Now Trump’s election appears to be assuaging those concerns.

There were exceptions to the early December surge in optimism, like respondents with a college degree and residents of the Northeast U.S., "although no group has adopted a pessimistic outlook for the economy," Curtin said in a statement.

Of course, consumer confidence will likely only remain healthy if economic growth aligns with consumer expectations in the coming months and years.

“The most important implication of the increase in optimism is that it has raised expectations for the performance of the economy,” Curtin said. “President-elect Trump must provide early evidence of positive economic growth as well as act to keep positive consumer expectations aligned with performance. Either too-slow growth or too-high expectations represent barriers to maintaining high levels of consumer confidence. Until specific policies are proposed, there is no reason to alter the 2017 forecast of 2.5% for real consumption.”

Consumer anxiety over the U.S. presidential election cost retailers more than $800 million in revenue from online sales this year, according to research conducted during the first half of November by Adobe Digital Insights. The sharpest drop occurred after the election, with total sales growth slowing to just 1.3%, compared to the predicted growth of 7.8%. Adobe said the change in spending habits marks the slowest growth rate for U.S. online sales it has identified since it started tracking retail spending.