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US Consumer Sentiment Hits 52.2, Marking Fourth Consecutive Monthly Decline

Inflation expectations surge to 6.5% as trade policy uncertainty drives economic pessimism across demographics.

A person shops in a supermarket as inflation affected consumer prices in Manhattan, New York City, U.S., June 10, 2022. REUTERS/Andrew Kelly/File Photo
Shoppers in San Francisco on April 15. The US consumer is clearly feeling uneasy in the current economic environment, but it’s unclear how that will translate into spending.
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Overview

  • The University of Michigan Consumer Sentiment Index fell to 52.2 in April, the lowest since July 2022 and down from 57 in March.
  • Year-ahead inflation expectations climbed to 6.5%, the highest level since 1981, while long-term expectations rose to 4.4%.
  • The Index of Expectations dropped 32% since January, the steepest three-month decline since the 1990 recession, reflecting concerns about weaker income growth and rising unemployment.
  • A partial 90-day tariff pause announced on April 9 slightly improved sentiment from earlier in the month, but overall economic concerns remain elevated.
  • The Federal Reserve has adopted a cautious approach, monitoring mixed economic indicators as soft data signals consumer unease over trade policies.