WASHINGTON (AP) — U.S. consumer sentiment fell slightly in May for the fifth straight month, surprising economists, as Americans increasingly worry that President Donald Trump’s trade war will worsen inflation.
The preliminary reading of the University of Michigan’s closely watched consumer sentiment index, released Friday, declined 2.7% on a monthly basis to 50.8, the second-lowest level in the nearly 75-year history of the survey. The only lower reading was in June 2022. Since January, sentiment has tumbled nearly 30%.
Americans have largely taken a sour view about where the economy is headed in the wake of the Trump administration’s imposition of huge import duties, which threaten to slow growth and push up prices. In recent weeks the White House has pulled back on its most draconian policies, though average duties are still high by historical standards.
Consumers’ outlooks are also sharply divided by their political views, which has caused some economists to question the survey’s results. The University of Michigan also last year switched from using both online and phone responses to just online, which some analysts worry may have introduced a more negative bias.
The sentiment index for Democrats fell to 33.9 this month, the lowest since partisan data began in 1980 and far below the levels reached in the depths of the COVID pandemic or during the 2008-2009 Great Recession.