US Consumer Sentiment Crashes to 44.8 — Third Straight Monthly Drop, Nearing 2022 Record Low!

US consumer sentiment plunged to 44.8 in May, its third consecutive monthly decline and dangerously close to the all-time low of 50.0 recorded in June 2022, according to the University of Michigan's closely watched survey. The reading signals that American households are growing increasingly pessimistic about the economic outlook despite a still-resilient labour market on paper.

The survey's inflation data is the part that should concern markets most. One-year inflation expectations ticked up from 4.7% to 4.8%, while long-term expectations — the metric the Fed watches most carefully as a gauge of anchoring — jumped from 3.5% to 3.9%. A full 57% of respondents said high prices were actively hurting their personal finances, a share that points to broad-based stress rather than isolated pockets of hardship.