Despite the ceasefire in the tariff war between the U.S. and China, consumer sentiment in the United States has reportedly worsened in May. Concerns about rising prices have also expanded.
The University of Michigan announced that the consumer sentiment index, reflecting consumer confidence in the U.S. economy, was recorded at a preliminary figure of 50.8 for May as of 16th (local time). This marked a 1.4 point decline compared to April (52.2), falling short of the Dow Jones consensus forecast (53.5) which had anticipated a rebound month-over-month.
Continuing the downward trend through May, the University of Michigan consumer sentiment index has now fallen for five consecutive months this year. However, unlike the sharp drop over the four months leading up to April, the decline in May was somewhat moderated.
The University of Michigan explained that this survey was conducted between April 22 and May 13.
Earlier, the U.S. and China agreed to significantly reduce tariffs imposed on each other during high-level trade negotiations held in Geneva, Switzerland, until the 11th.
Joanne Shu, director overseeing the University of Michigan consumer sentiment index, said, "While many survey indicators showed signs of improvement following the tariff reduction agreement, this initial rebound was not substantial enough to change the overall picture," and noted, "Consumers continue to express gloomy views about the economy."
Concerns about rising inflation among consumers have increased further in this survey.
Expectations for inflation over the next year rose from 6.5% in April to 7.3% in May, while the five-year inflation expectations increased from 4.4% in April to 4.6% in May.
Shu noted, "The rise in expected inflation this month was seen among supporters of both the Democratic and Republican parties," adding, "In particular, there was a significant increase among Republican supporters."
Amid growing concerns that the tariff policy shock from the Trump administration could lead the U.S. economy into a recession along with rising prices, Wall Street is closely monitoring the movements of consumer sentiment.