Consumer sentiment increased 4.7 points month-over-month in June to 49.5, down 11.2 points from one year ago, according to final results of the University of Michigan Surveys of Consumers. The Current Economic Conditions Index edged up 1.9 points from the previous month to 47.7 but down 17.1 points from the previous year. The Consumer Expectations increased 6.6 points to 50.7, 7.4 points lower than the June 2026 Index.
Consumer sentiment increased 10% above the previous month as gas prices moderated along with consumer worries. Increases were seen across income, wealth, and political affiliation. Expected business conditions over the next five years rose 16% as consumers’ worries over long-term consequences of the Iran conflict appear to be easing. Still, sentiment remains unfavorable, down 13% from last February’s reading prior to the start of the Iran conflict, and down 20% than a year ago. For the third straight month, the cost of living remains as consumer’s top issue. Over half of consumers spontaneously mentioned that high prices are weighing down their personal finances.
Year-ahead inflation expectations inched down from last month to a still-elevated 4.6% this month. The current reading is still higher than the 3.4% reading seen in February before the Iran conflict began, along with all 2024 readings. Long-run inflation expectations fell back from 3.9% last month to 3.3% in June, remaining a bit higher than the 2.8% to 3.2% range seen in 2024.
Read the University of Michigan Surveys of Consumers release.
