U.S. consumer sentiment continued to rise in late September, reaching a five-month high on more optimism about the economy in the wake of the Federal Reserve’s interest-rate cut. The University of Michigan’s final September sentiment index rose to 70.1 from the 69 preliminary reading released earlier this month. The latest figure issued Friday follows an August index of 67.9. The latest figure issued on Friday, September 27, follows an August index of 67.9.

Consumers expect prices to rise at an annual rate of 2.7% over the next year, the lowest since the end of 2020 and down from the 2.8% expected last month. They saw inflation rising 3.1% over the next five to 10 years.

The increase in sentiment followed a Sept. 18 decision by Fed policymakers to lower interest rates by a half percentage point as they guard against a deterioration in the job market. Further reductions in borrowing costs are helping to underpin consumers’ outlook on the economy and their personal finances.