University of Michigan Releases Final Results of Its Consumer Sentiment Index for May

On Friday, the University of Michigan released the final results of its Surveys of Consumers for May.

• The Index of Consumer Sentiment fell to a reading of 44.8, down 10.0% from 49.8 in April. Year-over-year, the index was down 14.2% from 52.2 in May 2025.
• Current Economic Conditions fell to a reading of 45.8, down 12.8% from 52.5 in April and down 22.2% from 58.9 in May 2025.
• The Index of Consumer Expectations declined to 44.1, down 8.3% from 48.1 in April and down 7.9% from 47.9 in May 2025.

In remarks accompanying the release, Surveys of Consumers Director Joanne Hsu said:

“Consumer sentiment fell for the third straight month as supply disruptions in the Strait of Hormuz continue to boost gasoline prices. Sentiment is now just below the previous historical trough seen in June 2022. The cost of living continues to be a first-order concern, with 57% of consumers spontaneously mentioning that high prices were eroding their personal finances, up from 50% last month. Lower-income consumers and those without college degrees posted particularly strong sentiment declines; these groups are more sensitive to increases in the cost of gas and other essentials. Independents and Republicans saw decreases in sentiment, with both groups reaching their lowest readings of the current presidential administration. Meanwhile, sentiment of Democrats was little changed from last month. Critically, consumers appear worried that inflation will increase and proliferate beyond fuel prices, even in the long run.

Year-ahead inflation expectations inched up from 4.7% last month to 4.8% this month. The current reading substantially exceeds the 3.4% reading seen in February 2026 prior to the start of the Iran conflict, along with all 2024 readings. Long-run inflation expectations climbed from 3.5% in April to 3.9% in May, notably higher than the 2.8–3.2% range seen in 2024. This month’s increase in long-run expectations reflects sizable jumps among independents and Republicans. For the latter group, long-run inflation expectations are currently more than double their February 2025 reading on a monthly basis.”