Inflation, Tariffs Turn Consumers Sour on Trumponomics

Consumer sentiment took a marked shift downward in the latest University of Michigan’s monthly sentiment survey released Friday as Americans expressed increasing concern about President Donald Trump’s proposed import tariffs and continuing inflation.

The overall consumer sentiment index for February dropped 9.8% from January to a reading of 64.7 while the index of current conditions fell 12.5% to 65.7. The index that measures how consumers feel about future economic conditions dropped 7.9% to 64. Consumer sentiment overall is down nearly 16% from a year ago.

Notably, inflation expectations surged with consumers saying they expect year-ahead prices to rise by 4.3% over the next 12 months, a full percentage point jump from a month ago. And expectations for long-term inflation saw the largest monthly increase since May 2021.

“The decrease was unanimous across groups by age, income, and wealth,” said survey director Joanne Hsu in a statement. “All five index components deteriorated this month, led by a 19% plunge in buying conditions for durables, in large part due to fears that tariff-induced price increases are imminent.”