Consumer sentiment plunges

U.S. consumer sentiment fell to 47.6 in April, its weakest reading in months, as households reported deeper worries about prices and the economy. (umich.edu) The University of Michigan said Friday that sentiment dropped from 53.3 in March to 47.6 in April, a decline of about 11%. Its current conditions gauge fell to 50.1 from 55.8, and expectations dropped to 46.1 from 51.7. (umich.edu) Director Joanne Hsu said declines showed up across age, income and political groups, and every major part of the index weakened. One-year expected business conditions fell about 20%, and assessments of personal finances dropped about 11%. (umich.edu) The survey also showed inflation fears moving the wrong way. Consumers’ expected inflation over the next year rose to 4.8% from 3.8% in March, the largest one-month increase since April 2025. (umich.edu) Longer-run inflation expectations also edged higher, to 3.4% from 3.2%, the highest since November 2025. That leaves both short-run and long-run expectations above the ranges the survey recorded in 2024 and before the pandemic. (umich.edu) Consumers also said buying conditions for vehicles and other durable goods worsened because prices remained high. Open-ended responses cited the Iran conflict as a reason for unfavorable economic changes. (umich.edu) The timing matters. The survey said 98% of interviews were completed before the April 7 announcement of a temporary cease-fire, so the April reading largely captured views formed during the earlier supply-shock scare. (umich.edu) Hsu said expectations could improve if consumers become confident that supply disruptions tied to the Iran conflict have ended and gas prices have moderated. For now, the April data show households entered late spring expecting weaker finances and faster price increases. (umich.edu)