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5d ago

US Consumer Sentiment Jumps 16% to 60.5 as Tariff Fears Ease

Rollback of tariffs alongside progress in China trade talks reduced inflation worries, lifting consumer mood.

A woman shops for lettuce at the Mid-Ohio Market at Norton, a modern food pantry designed to replicate a grocery store experience, in Columbus, Ohio, U.S., May 13, 2025. REUTERS/Evelyn Hockstein/File Photo
Image
American consumers appear to have settled a little after the extremely high tariffs announced in April.
Diners at a restaurant in Philadelphia on May 22, 2025.

Overview

  • University of Michigan’s preliminary consumer sentiment index rose 16% to 60.5 in early June, marking the first increase after six months of declines.
  • One-year inflation expectations dropped to 5.1% from 6.6% in May, constituting the largest monthly decline in short-term outlook since 2001.
  • Sentiment gains were uniform across age groups, income brackets, wealth levels, political affiliations and regions, according to director Joanne Hsu.
  • Tariff rollbacks by the Trump administration and a temporary truce with China eased fears of price shocks and boosted household confidence.
  • Both consumer and producer prices rose just 0.1% in May, defying concerns that tariffs would fuel inflation while economists caution import duties may still drive up costs later this year.