A report from the University of Michigan showed on Friday the
preliminary reading for the Reuters/Michigan index of consumer sentiment plunged
14.0 percent m-o-m to 50.2 in early June. This was the lowest reading ever on
records dating back to 1978.
Economists had predicted the index would come in at 58.0 this month,
down slightly from May’s final reading of 58.4.
According to the report, the index of consumer expectations declined 15.2
percent m-o-m to 46.8 this month, its lowest level since May 1980. Meanwhile, the
index of current U.S. economic conditions dropped 12.5 percent m-o-m to 55.4, its
lowest level on record.
Surveys of Consumers chief economist, Richard Curtin, noted that consumers'
assessments of their personal financial situation worsened about 20% in June,
with 46 percent of consumers attributing their negative views to inflation, the
highest share since 1981, during the Great Recession.
The report revealed that the estimates of year-ahead expected inflation increased
to 5.4 percent in June from 5.3 percent in the previous month, and the 5-year
expected inflation rose to 3.3 percent from 3.0 percent in May.