US consumer sentiment improved noticeably in June, with the University of Michigan’s headline index rising from 44.8 to 48.9 as easing gasoline prices provided some relief to households. The gain was broad-based, with improvements recorded across age groups, education levels and political affiliations. The Current Economic Conditions index rose from 45.8 to 48.3, while Consumer Expectations climbed from 44.1 to 49.3, suggesting consumers became somewhat less pessimistic about both present conditions and the outlook ahead.
According to Surveys of Consumers Director Joanne Hsu, the improvement was largely driven by lower fuel costs early in the month. “Consumers experienced some relief due to the early-month easing in gasoline prices,” she noted. Assessments of personal finances and business conditions also improved. However, Hsu cautioned that overall sentiment remains historically weak. Despite June’s rebound, consumer confidence is still 13% below its January level and 19% lower than a year ago, reflecting continued concerns about rising living costs and the broader inflation environment.
Inflation expectations eased modestly but remain elevated. One-year inflation expectations edged down from 4.8% to 4.6%, while long-run expectations fell from 3.9% to 3.4%. Even so, both measures remain well above levels seen before the outbreak of the Iran conflict.
The data suggests consumers are becoming slightly less worried about near-term price pressures as energy costs retreat, but concerns that inflation could remain stubbornly high continue to weigh heavily on household sentiment.
| Indicator | Jun | May | Change |
|---|---|---|---|
| Consumer Sentiment | 48.9 | 44.8 | +4.1 |
| Current Economic Conditions | 48.3 | 45.8 | +2.5 |
| Consumer Expectations | 49.3 | 44.1 | +5.2 |
| 1-Year Inflation Expectations | 4.6% | 4.8% | -0.2ppt |
| Long-Run Inflation Expectations | 3.4% | 3.9% | -0.5ppt |
