WASHINGTON—U.S. consumer sentiment fell to another record low in May as Americans grew increasingly worried about inflation, rising gasoline prices and the broader economic outlook, according to the latest University of Michigan survey released Friday.
The University of Michigan’s Consumer Sentiment Index dropped to a final reading of 44.8 in May, down sharply from 49.8 in April and below economists’ expectations. The decline marked the lowest reading ever recorded for the closely watched gauge of consumer confidence, Reuters noted.
Reuters reported the worsening sentiment was tied heavily to higher gasoline prices linked to ongoing tensions in the Middle East and concerns that inflation pressures are spreading beyond energy costs. The survey found 57% of consumers said high prices were hurting their personal finances, up from 50% in April.
The report also showed inflation expectations continued climbing. Consumers now expect inflation to run at 4.8% over the next year, up from 4.7% in April, while long-term inflation expectations rose to 3.9% from 3.5%. Both the current conditions and future expectations components of the survey also hit record lows.
Economists said the weak reading underscores growing anxiety among households as higher living costs continue pressuring budgets despite a still-resilient labor market. Analysts noted lower-income consumers and those without college degrees posted some of the steepest declines in confidence, reflecting the disproportionate impact of higher fuel and everyday living costs.