US consumer confidence fell even further than estimated in May: survey

TDT | Washington

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Record-low US consumer confidence in May was even worse than initially reported, according to fresh data released by the University of Michigan yesterday, with Americans battered by the economic fallout of the Iran war.

According to final figures, the university’s consumer sentiment index came in at 44.8 points, down from 48.2 points in its preliminary estimate released on May 8.

The reading is the lowest level since data collection began in 1952, according to the survey’s website.

“The cost of living continues to be a first-order concern, with 57% of consumers spontaneously mentioning that high prices were eroding their personal finances, up from 50 percent last month,” said Joanne Hsu, director of the survey.

The US-Israel war on Iran has engulfed the Middle East in violence and sent global energy prices skyrocketing over Tehran’s retaliatory actions.

Members of US President Donald Trump’s Republican Party reported a decrease in sentiment, hitting their lowest level in the current administration’s term.

“Critically, consumers appear worried that inflation will increase and proliferate beyond fuel prices, even in the long run,” Hsu said. Respondents to the survey expected consumer inflation to hit 4.8% in the year ahead, up significantly from before the war.

Long-run inflation expectations rose to 3.9%, significantly above the US Federal Reserve’s target of two percent.