Consumer Sentiment Falls To Record Low on Gas Prices, Inflation Fears

Consumer sentiment fell to the lowest level on record, pulled down by concerns over high gas prices and rising inflation.

The University of Michigan’s index of consumer sentiment dropped to 44.8 in May, data released Friday showed. This was weaker than even the lowest projections in a survey of Wall Street economists by Econoday and lower than the preliminary May reading of 48.2.

The final April reading was 49.8. May was the third consecutive monthly decline, with the index falling each month since the war with Iran began and gasoline prices began climbing to multi-year highs.

Both the gauge of current conditions and the gauge of expectations decline.

“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,” said Joanne Hsu, the director of the survey.