University of Michigan Releases Preliminary Results of Its Consumer Sentiment Index for September

On Friday, the University of Michigan released the preliminary results of its Surveys of Consumers for September.

• The Index of Consumer Sentiment fell to a reading of 47.8 in September, down 7.5% from 51.7 in August. Year-over-year, the index was down 13.2% from 55.1 in September 2025.
• Current Economic Conditions fell to a reading of 50.9 in September, down 1.9% from 51.9 in August and 15.7% from 60.4 in September 2025.
• The Index of Consumer Expectations fell to 45.8 in September, down 11.1% from 51.5 in August and 11.4% from 51.7 in September 2025.

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

“Consumer sentiment receded less than 4 index points for the second consecutive month of decreases. Democrats and Republicans alike posted sizable declines, while independents were little changed from August. Year-ahead expectations for both personal finances and business conditions plunged. With a resurgence in fuel prices and trade tensions, consumers anticipate greater pressures on their pocketbooks to come. Five-year expected business conditions remained stable at readings well below their historical average, suggesting that consumers believe that emerging risks this month may not have further worsened the long-run outlook. Overall, sentiment is now 16% below February, prior to the start of the Iran conflict, and 13% lower than a year ago.

Year-ahead inflation expectations jumped from 4.0% last month to 4.6% this month, the highest reading since June. The current reading substantially exceeds the 3.4% seen in February before the Iran conflict began, along with all 2024 readings. Long-run inflation expectations ticked up to 3.4%, ending three consecutive months at 3.3%. These expectations remain higher than their 2024 range of 2.8–3.2%.”