breaking

Consumer Sentiment Plummets to Historic Lows as Households Struggle With Cumulative Price Shock

The University of Michigan's consumer sentiment index hit all-time lows in May, signaling deepening pessimism among American households more than six years after the pandemic began. Multiple consumer confidence surveys show families have yet to regain faith in the economy's fundamentals, despite some signs of resilience in broader economic data. Economists attribute the disconnect to years of accumulated price increases that have left consumers scarred even as annual inflation rates moderate. Households also cite exhaustion from successive economic disruptions, including pandemic aftereffects, geopolitical conflicts, and tariff-related pressures. Cleveland Federal Reserve President Beth Hammack noted the cumulative impact represents roughly a decade's worth of inflation compressed into half that time. While policymakers track year-over-year inflation rates approaching the Federal Reserve's 2% target, consumers focus on the total cost increases they've absorbed over several years.