US Consumer Confidence Takes a Hit in May

The preliminary report from the University of Michigan revealed a 2.7% drop in the Consumer Sentiment Index for May, settling at 50.8. This marks a significant 26.5% decrease compared to the same period last year.

Economic Conditions and Consumer Expectations Worsen

The Current Economic Conditions Index fell by 3.7% from April and saw a steep 17.2% decline year-over-year, reaching 57.6 points. Similarly, the Index of Consumer Expectations decreased by 1.7% monthly and plummeted 32.4% annually, landing at 46.5.

Inflation Expectations on the Rise

"Year-ahead inflation expectations jumped from 6.5% in April to 7.3% in May, affecting both Democrats and Republicans. Long-run inflation expectations also increased, from 4.4% to 4.6%," the report highlighted. It also noted, "Uncertainty over trade policy continues to dominate consumers' views on the economy."