US consumer sentiment hits record low in May

The University of Michigan’s final consumer sentiment index for May 2026 fell to 44.8, a new historical low for the series. The reading was weaker than the preliminary May figure of 48.2 and represented a 5-point decline from April, underscoring a sharp deterioration in US consumer mood.

The May drop marked the third consecutive monthly decline in the index. The survey results, released on May 22, 2026, indicate that households are increasingly pessimistic about current conditions and the economic outlook amid a persistently challenging price environment.

Consumers’ inflation expectations climbed in May alongside the decline in sentiment. Year-ahead inflation expectations in the Michigan survey rose to 4.8% in May 2026, up from 4.7% in April. Longer-run inflation expectations also moved higher, reaching about 3.9%.

The rise in both short- and longer-term expectations suggests that many households see price pressures as persistent rather than temporary. These expectations form part of the backdrop that market participants and some policymakers have said could influence the timing and scope of future interest-rate decisions.

The survey highlighted extensive concern about the impact of prices on personal finances. In the May 2026 survey, 57% of respondents said that high prices were eroding their personal finances, reflecting broad-based pressure on household budgets.

Nearly 40% of respondents spontaneously mentioned gasoline prices when asked about the economy, signaling that fuel costs are a particularly visible and immediate source of strain. The prominence of gasoline in consumer responses aligns with parallel worries about wider price increases.

Surveys of Consumers director Joanne Hsu linked the decline in sentiment to developments in energy markets and geopolitics. Hsu cited supply disruptions in the Strait of Hormuz and elevated gasoline prices as key drivers of the latest drop in confidence.

These factors have fed concerns that higher energy costs could spill over into broader inflation. The May 2026 Michigan reading and associated coverage depict a consumer outlook weakened by rising fuel expenses and fear that price increases may spread beyond energy, contributing to the record-low sentiment level.