U.S. consumer sentiment weakened in September, falling to a four-month low as households reported mounting pressure from high prices and uncertainty about the job market, Bloomberg writes.
The University of Michigan’s final sentiment index dropped to 55.1 from 58.2 in August, with survey director Joanne Hsu noting that 44% of respondents spontaneously mentioned inflation as eroding their finances—the highest share in a year.
Consumers expect prices to climb 4.7% over the next year, a modest decline from earlier readings, while long-term inflation expectations ticked higher. Sentiment declined across most income groups but held steady among wealthier households with significant stock holdings, reflecting equities’ resilience.
Even so, inflation-adjusted consumer spending continued to expand for a third month, underscoring the economy’s reliance on household demand. The latest reading, conducted through Sept. 22, highlights a complicated backdrop for the Federal Reserve, which is navigating slowing job and income growth alongside persistent inflation pressures.
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