U.S. consumer sentiment fell for the third straight month to another record low in May due to rising gasoline prices and fears of persistent inflation, according to the latest University of Michigan’s consumer sentiment survey.
The University’s closely watched Index of Consumer Sentiment dropped to 44.8 in May, down from 49.8 in April and below the preliminary May reading of 48.2. The latest figure marks the lowest level recorded since the survey began in 1952.
The index is down 14.2 percent from 52.2 in May 2025.
Surveys of Consumers Director Joanne Hsu said in a statement, “Consumer sentiment fell for the third straight month as supply disruptions in the Strait of Hormuz continue to boost gasoline prices. Sentiment is now just below the previous historical trough seen in June 2022. The cost of living continues to be a first-order concern, with 57 percent of consumers spontaneously mentioning that high prices were eroding their personal finances, up from 50 percent last month. Lower-income consumers and those without college degrees posted particularly strong sentiment declines; these groups are more sensitive to increases in the cost of gas and other essentials. Independents and Republicans saw decreases in sentiment, with both groups reaching their lowest readings of the current presidential administration. Meanwhile, sentiment of Democrats was little changed from last month. Critically, consumers appear worried that inflation will increase and proliferate beyond fuel prices, even in the long run.
“Year-ahead inflation expectations inched up from 4.7 percent last month to 4.8 percent this month. The current reading substantially exceeds the 3.4 percent reading seen in February 2026 prior to the start of the Iran conflict, along with all 2024 readings. Long-run inflation expectations climbed from 3.5 percent in April to 3.9 percent in May, notably higher than the 2.8 percent to 3.2 range seen in 2024. This month’s increase in long-run expectations reflects sizable jumps among independents and Republicans. For the latter group, long-run inflation expectations are currently more than double their February 2025 reading on a monthly basis.”
Chart courtesy University of Michigan
