U.S. Consumer Sentiment Hits 15-Month Low Amid Inflation Fears

U.S. consumer sentiment in February hit its lowest in 15 months as concerns over President Trump's tariff plans grew. The University of Michigan reported a drop to 64.7 from January's 71.7. Inflation expectations also surged, with households predicting a rise over the next five years.

U.S. consumer sentiment plummeted to its lowest point in over a year amid growing fears about the impact of President Donald Trump's proposed tariffs. According to the University of Michigan Surveys of Consumers, the Consumer Sentiment Index dropped significantly in February to 64.7, down from a revised 71.7 in January.

The index, now at its lowest level since November 2023, fell short of economists' expectations and reflected increasing apprehension among households regarding purchasing power and inflation. Expected inflation over the next year has surged to 4.3%, the highest since November 2023.

Concerns aren't limited to the short term, as households anticipate inflation over the next five years to rise to 3.5%, marking a significant increase from previous readings. This reflects a broader anxiety over the economic impact of potential trade policies and inflationary pressures.