Consumer confidence plunged
The University of Michigan’s April consumer‑sentiment index reportedly fell to 51.5, a level described as the lowest reading since the survey began in the 1940s, driven in part by rising inflation expectations. That drop signals heightened household caution that could affect discretionary home projects. (startupfortune.com)
U.S. consumer sentiment fell to 47.6 in preliminary April data, the lowest reading in the University of Michigan survey’s history. (sca.isr.umich.edu) The index was 53.3 in March and 52.2 in April 2025. The University of Michigan said sentiment dropped about 11% in a month, with declines across age, income and political groups. (sca.isr.umich.edu) Households also raised their inflation expectations sharply. The survey said one-year inflation expectations jumped to 4.8% from 3.8% in March, while long-run expectations rose to 3.4% from 3.2%. (sca.isr.umich.edu) The survey tied much of the slide to higher prices and weaker views of personal finances. It said buying conditions for durable goods and vehicles worsened, and many respondents blamed the Iran conflict for the economic shift. (sca.isr.umich.edu) A separate Federal Reserve Bank of New York survey, released April 7, also found inflation worries rising before the Michigan report landed. Its March survey showed one-year inflation expectations at 3.4%, gas-price expectations at 9.4%, and unemployment expectations at the highest level since April 2025. (newyorkfed.org) That matters for home spending because remodeling is often the kind of purchase households can delay. Harvard’s Joint Center for Housing Studies said in January that annual spending growth on owner-occupied home improvements and maintenance is expected to slow through 2026. (jchs.harvard.edu) The home-improvement industry was already describing consumers as cautious before April’s sentiment drop. The Home Improvement Research Institute said in February that customer confidence was “tempered” at the start of 2026 and that homeowners were tightening project priorities and budgets. (hiri.org) Not every spending forecast has turned negative. The National Retail Federation said on March 18 that it still expects 2026 retail sales to rise 4.4% to $5.6 trillion, even as it warned that higher-income households are driving much of the growth and sentiment has stayed weak. (nrf.com) The next test is April 24, when the University of Michigan releases its final April reading. If inflation fears ease with lower gas prices and a steadier geopolitical backdrop, sentiment could stabilize after one of its sharpest monthly drops in years. (sca.isr.umich.edu)
