FX.co ★ US Consumer Sentiment Falls Sharply

Consumer sentiment in the United States experienced a significant drop in April 2025, with the University of Michigan index falling to 50.8, marking the lowest point since June 2022. This represents a decline from 57 in March and falls well short of the anticipated 54.5, according to preliminary estimates. The sentiment has decreased for the fourth consecutive month, reflecting a cumulative loss of over 30% since December 2024. This downturn is primarily due to escalating concerns about fluctuating trade war developments throughout the year. Consumers have expressed heightened anxiety on several fronts, notably in business conditions, personal finances, income expectations, inflation, and labor market outlooks, all of which have further deteriorated this month. The measure of current economic conditions dropped to 56.5 from 53.8, while the expectations index fell to 47.2, marking its lowest level since May 1980, down from 52.6. Furthermore, expectations for inflation over the next year have surged to 6.7%, the highest level since 1981, up from 5%. On a five-year horizon, inflation expectations have inched up to 4.4% from 4.1%.