United States consumer sentiment has reached an almost four year low, after falling for a second consecutive month.
Declines in sentiment reached levels comparable to its mid-2022 trough and were seen across political party, income, age and education, according to the University of Michigan Surveys of Consumers.
Earlier in the month, the index sat at 47.6, but this rose slightly to 49.8 after a two-week ceasefire was announced and gas prices ticked slightly lower; however, this still marks an all-time low.
Expected business conditions declined for both the short and long run, nearly matching year-ago readings when the reciprocal tariff regime was implemented.
“The Iran conflict appears to be passing through to consumer views primarily through effects on prices, particularly gas and energy prices stemming from disruptions to shipping,” University of Michigan director of surveys, Joanne Hsu, said.
“At this time, consumers do not foresee relief from high prices in the near future.
“In fact, consumers expect them to worsen before they improve.”
The national average retail gasoline price has hovered above $4 a gallon this month, with diesel well above $5 a gallon, data from the U.S. Energy Information Administration (EIA) showed.
According to a Reuters/Ipsos poll, a clear majority of Americans blame Trump for the surging gasoline prices, which are weighing on the Republican party ahead of the November midterm elections.
The University of Michigan also found that views of personal finance and buying conditions have worsened.
Average year-ahead gas price expectations surged almost sixfold from February, reaching its highest reading since June 2022, soon after Russia invaded Ukraine and the peak of post-pandemic inflation.
