The University of Michigan’s consumer sentiment index declined to 47.8 in early September 2026, falling for a second consecutive month and coming in well below market expectations of 51.0, according to the preliminary estimate. This marks the weakest reading since May’s record low.
Year-ahead expectations for personal finances and business conditions also worsened, as consumers brace for increased pressure on household budgets amid rising fuel prices and ongoing trade tensions. In contrast, five-year business expectations were broadly stable, though they remained well below their historical average. This suggests that while consumers are concerned about current risks, they do not expect these to significantly deepen over the longer term.
Overall sentiment now stands 16% below its February level, prior to the onset of the Iran conflict, and 13% lower than a year earlier. Year-ahead inflation expectations jumped to 4.6%, the highest since June, while five-year expectations inched up to 3.4% after remaining at 3.3% for three consecutive months.
