Consumer sentiment plunges to second-lowest level on record
The mood of Americans continues to sour amid rising concerns about inflation and unemployment.
Consumer sentiment fell 11% in April to a preliminary reading of 50.8, down from a final reading of 57.0 in March, according to the University of Michigan’s Consumer Sentiment Index. It was the second-lowest reading in the survey’s history going back to 1952, and the lowest reading since June 2022.
“This decline was, like the last month’s, pervasive and unanimous across age, income, education, geographic region and political affiliation,” said Joanne Hsu, director of consumer surveys, University of Michigan. “Sentiment has now lost more than 30% since December 2024 amid growing worries about trade war developments that have oscillated over the course of the year.”
The index for current economic conditions fell to 56.5, down 11.4% from March. The expectations index declined 10.3% to 47.2, which marked its lowest since May 1980.
In addition, the share of consumers expecting unemployment to rise in the year ahead increased for the fifth consecutive month. It is now more than double the November 2024 reading and the highest since 2009.
[READ MORE: Trump pauses most reciprocal tariffs, raises levy on China]
“Consumers report multiple warning signs that raise the risk of recession: expectations for business conditions, personal finances, incomes, inflation, and labor markets all continued to deteriorate this month,” Hsu said.
Inflation
Expectations for overall inflation during the next year rose to 6.7% in April — the highest reading since November 1981 — and up from 5% in March. All political parties reported higher inflation expectations.
The University of Michigan survey was fielded between March 25 and April 8, which was the day before President Trump announced a 90-day pause on most of the reciprocal tariffs.
