U.S. consumer sentiment plunged in September to one of its weakest readings on record as Americans grew more pessimistic about prices and the economy. The University of Michigan said its preliminary consumer sentiment index fell to 47.8, the second-lowest level ever recorded if it is confirmed.
The reading was down 7.5% from 51.7 in August and came in below the 51.4 forecast by analysts surveyed by Dow Jones. The current economic conditions index slipped to 50.9 from 51.9, while the consumer expectations index fell to 45.8 from 51.5.
Inflation expectations also moved higher. Consumers now expect prices to rise 4.6% over the next year, up from 4.0% in August, and see five-year inflation at 3.4%, up from 3.3%.
Joanne Hsu, the University of Michigan’s director of surveys, said one-year expectations for personal finances and business conditions “fell sharply,” adding that consumers expected higher gas prices and rising trade tensions to further strain household budgets.
