U.S. consumer confidence slips

Published May 27, 2026 by The Daily Scout

- The Conference Board said May 26 that its U.S. consumer confidence index slipped to 93.1 in May as households cited inflation and Middle East-related price shocks. - Dana Peterson of the Conference Board said the “inflationary impacts” of the war in the Middle East intensified, while the present-situation measure fell 3.6 points. - The Conference Board’s next monthly consumer confidence release is scheduled for late June, alongside continued University of Michigan sentiment and inflation-expectations updates.

Why it matters

The Conference Board reported on May 26 that U.S. consumer confidence edged lower in May, a sign that households remained uneasy about prices even as stock markets stayed firm. Its headline index slipped 0.7 point to 93.1 from an upwardly revised 93.8 in April, while consumers’ assessment of current business and labor-market conditions weakened more sharply. Dana Peterson, the group’s chief economist, said the survey captured the effect of higher prices tied to the war in the Middle East. The May reading matters less for its size than for what sat underneath it. The present-situation index fell 3.6 points to 129.7, while the expectations index rose 1 point to 74.4 but stayed below the 80 level that the Conference Board has said can signal recession risk. Separate University of Michigan data for May showed sentiment at 44.8, with year-ahead inflation expectations rising to 4.8%. ### Why did confidence slip if the headline move was small? (prnewswire.com) The Conference Board said consumers increasingly pointed to inflation, gasoline and war in their write-in responses. Peterson said “the inflationary impacts of the war in the Middle East intensified,” and the survey period ran from May 1 through May 19. Reuters reported households were also still broadly pessimistic about the labor market, even if some expected conditions to improve later this year. (prnewswire.com) Bloomberg reported that views of current conditions softened as rising prices spread through household budgets. That helps explain why a modest decline in the headline index can still signal strain: consumers may not be collapsing in confidence month to month, but they are telling survey takers they feel less comfortable about day-to-day conditions. ### Which parts of the survey were weakest? The 129.7 present-situation reading was the clearest soft spot in May. (conference-board.org) That measure tracks how consumers view current business conditions and the labor market, and it fell more than the headline index did. By contrast, the expectations gauge improved slightly, though at 74.4 it remained below the threshold the Conference Board associates with recession warnings. The University of Michigan survey painted a darker picture. (bloomberg.com) Its final May sentiment reading of 44.8 was described in summaries of the release as the lowest in the survey’s history, with both short-term and long-term inflation expectations moving higher. The two surveys use different methods, but both pointed to persistent price anxiety. ### What does this tell us about how households are behaving? Reuters reported that confidence data and other spending surveys suggested households were becoming more cautious about discretionary purchases. (prnewswire.com) The Washington Post, citing a separate survey, reported that two-thirds of Americans said they were cutting back on spending even as equity markets hovered near highs. That pattern usually shows up first in delayable purchases. (sca.isr.umich.edu) When consumers are worried about gasoline, food and broader inflation, they tend to keep spending on essentials and defer optional projects, upgrades and big-ticket items, according to economists cited in broad coverage of the May data. ### Why would retailers such as Home Depot care about this report? Home-improvement chains are exposed to the difference between necessary spending and discretionary spending. (newsbreak.com) When confidence weakens and inflation expectations rise, shoppers are more likely to trade down, postpone nonessential projects or ask harder questions about price and durability. That is especially relevant for categories tied to remodeling, décor and seasonal purchases rather than urgent repairs. (latimes.com) Home Depot has recently pointed to strength from professional customers and spring categories while acknowledging cautious consumer demand, according to earnings-related coverage in the broader briefing material. If May’s confidence readings persist, retailers will be dealing with customers who are still buying, but with more focus on necessity, value and timing. ### What should readers watch next? (newsbreak.com) Late June will bring the Conference Board’s next consumer confidence release, which will show whether May’s price shock proved temporary or broadened further. Before then, investors and retailers will also watch weekly gasoline prices, inflation readings and the next University of Michigan sentiment update for signs that household expectations are either stabilizing or worsening. (conference-board.org) (newsbreak.com)

Key numbers

The Conference Board said May 26 that its U.S.
consumer confidence index slipped to 93.1 in May as households cited inflation and Middle East-related price shocks.
Dana Peterson of the Conference Board said the “inflationary impacts” of the war in the Middle East intensified, while the present-situation measure fell 3.6 points.
The Conference Board reported on May 26 that U.S.

What happens next

The Conference Board reported on May 26 that U.S.
consumer confidence edged lower in May, a sign that households remained uneasy about prices even as stock markets stayed firm.
The May reading matters less for its size than for what sat underneath it.

Sources

Quick answers

What happened in U.S. consumer confidence slips?

The Conference Board said May 26 that its U.S. consumer confidence index slipped to 93.1 in May as households cited inflation and Middle East-related price shocks. Dana Peterson of the Conference Board said the “inflationary impacts” of the war in the Middle East intensified, while the present-situation measure fell 3.6 points. The Conference Board’s next monthly consumer confidence release is scheduled for late June, alongside continued University of Michigan sentiment and inflation-expectations updates.

Why does U.S. consumer confidence slips matter?

The Conference Board reported on May 26 that U.S. consumer confidence edged lower in May, a sign that households remained uneasy about prices even as stock markets stayed firm. Its headline index slipped 0.7 point to 93.1 from an upwardly revised 93.8 in April, while consumers’ assessment of current business and labor-market conditions weakened more sharply. Dana Peterson, the group’s chief economist, said the survey captured the effect of higher prices tied to the war in the Middle East. The May reading matters less for its size than for what sat underneath it. The present-situation index fell 3.6 points to 129.7, while the expectations index rose 1 point to 74.4 but stayed below the 80 level that the Conference Board has said can signal recession risk. Separate University of Michigan data for May showed sentiment at 44.8, with year-ahead inflation expectations rising to 4.8%. Why did confidence slip if the headline move was small? (prnewswire.com) The Conference Board said consumers increasingly pointed to inflation, gasoline and war in their write-in responses. Peterson said “the inflationary impacts of the war in the Middle East intensified,” and the survey period ran from May 1 through May 19. Reuters reported households were also still broadly pessimistic about the labor market, even if some expected conditions to improve later this year. (prnewswire.com) Bloomberg reported that views of current conditions softened as rising prices spread through household budgets. That helps explain why a modest decline in the headline index can still signal strain: consumers may not be collapsing in confidence month to month, but they are telling survey takers they feel less comfortable about day-to-day conditions. Which parts of the survey were weakest? The 129.7 present-situation reading was the clearest soft spot in May. (conference-board.org) That measure tracks how consumers view current business conditions and the labor market, and it fell more than the headline index did. By contrast, the expectations gauge improved slightly, though at 74.4 it remained below the threshold the Conference Board associates with recession warnings. The University of Michigan survey painted a darker picture. (bloomberg.com) Its final May sentiment reading of 44.8 was described in summaries of the release as the lowest in the survey’s history, with both short-term and long-term inflation expectations moving higher. The two surveys use different methods, but both pointed to persistent price anxiety. What does this tell us about how households are behaving? Reuters reported that confidence data and other spending surveys suggested households were becoming more cautious about discretionary purchases. (prnewswire.com) The Washington Post, citing a separate survey, reported that two-thirds of Americans said they were cutting back on spending even as equity markets hovered near highs. That pattern usually shows up first in delayable purchases. (sca.isr.umich.edu) When consumers are worried about gasoline, food and broader inflation, they tend to keep spending on essentials and defer optional projects, upgrades and big-ticket items, according to economists cited in broad coverage of the May data. Why would retailers such as Home Depot care about this report? Home-improvement chains are exposed to the difference between necessary spending and discretionary spending. (newsbreak.com) When confidence weakens and inflation expectations rise, shoppers are more likely to trade down, postpone nonessential projects or ask harder questions about price and durability. That is especially relevant for categories tied to remodeling, décor and seasonal purchases rather than urgent repairs. (latimes.com) Home Depot has recently pointed to strength from professional customers and spring categories while acknowledging cautious consumer demand, according to earnings-related coverage in the broader briefing material. If May’s confidence readings persist, retailers will be dealing with customers who are still buying, but with more focus on necessity, value and timing. What should readers watch next? (newsbreak.com) Late June will bring the Conference Board’s next consumer confidence release, which will show whether May’s price shock proved temporary or broadened further. Before then, investors and retailers will also watch weekly gasoline prices, inflation readings and the next University of Michigan sentiment update for signs that household expectations are either stabilizing or worsening. (conference-board.org) (newsbreak.com)