US consumer sentiment plunges on worries over prices from inflation and tariffs

Published On Feb 21, 2025, 8:21 PM

Consumer sentiment in the U.S. dropped to its lowest level in over a year, with the University of Michigan's consumer sentiment index falling from 71.7 in January to 64.7 in February. This decline was attributed to rising inflation expectations and uncertainty surrounding tariff policies under President Trump's administration. Inflation expectations among households increased sharply, hitting 4.3% for the next year and 3.5% over the next five years, indicating greater economic anxiety. The combination of these factors suggests consumers are feeling increasingly pessimistic about the economic outlook, which could impact retail sales and overall economic growth.