The latest data on U.S. consumer sentiment and economic outlook has revealed a more pessimistic outlook among Americans, as the University of Michigan’s consumer sentiment index dropped to 77.9 in April from 79.4 in March. This dip was more significant than economists had anticipated, with expectations for a reading of 79.
The survey also showed an increase in inflation expectations, with the latest read on consumer sentiment falling to 79.3 in April from 82.5 last month. One-year inflation expectations rose to 3.1% from 2.9% in March, while the five-year outlook increased to 3.0% from 2.8%.
The findings suggest that consumers are cautious about the economy, with many attributing their skepticism to the upcoming election and its potential impact on economic policies. This sentiment is reflected in the Labor Department data, which revealed that the Consumer Price Index rose for the third consecutive month to 3.5% from a year ago, while wholesale inflation saw its biggest jump since April 2023.
Although inflation has decreased from a peak of 9.1%, it has remained above the Federal Reserve’s 2% target for over two years. The ongoing uncertainty surrounding the economy and rising inflation expectations are likely to continue influencing consumer sentiment in the coming months. Stay tuned to Female Arts for more updates on the economy and its impact on American households.
