US Consumer Sentiment Falls to Four-Month Low on Inflation, Job Concerns

U.S. consumer sentiment declined to 55.4 in September, marking the lowest level since May and falling more sharply than economists had anticipated, according to the University of Michigan's Survey of Consumers. The drop was driven largely by heightened concerns among lower and middle-income consumers about the economy, labor market, and inflation. Consumers' perceptions of their current and expected personal finances fell about 8%, while buying conditions for durables showed some improvement. Inflation expectations for the year ahead remained steady at 4.8%, but long-term inflation expectations rose to 3.9%, continuing an upward trend. Trade policy, particularly tariffs associated with President Donald Trump's administration, remains a significant concern, with around 60% of consumers mentioning it unprompted. Overall, the data reflect ongoing vulnerabilities in business conditions and consumer confidence amid persistent economic uncertainties.