U.S. Consumer Sentiment Unexpectedly Drops In March, Inflation Expectations Dip
(RTTNews) - Consumer sentiment in the U.S. fell for the first time in four months in March, according to a preliminary report released by the University of Michigan on Friday.
The report said the consumer sentiment index slid to 63.4 in March from 67.0 in February. Economists had expected the index to be unchanged.
Surveys of Consumers Director Joanne Hsu noted the decrease was already fully realized prior to the failure of Silicon Valley Bank.
"Sentiment declines were concentrated among lower-income, less-educated, and younger consumers, as well as consumers with the top tercile of stock holdings," Hsu said.
She added, "Overall, all components of the index worsened relatively evenly, primarily on the basis of persistently high prices, creating downward momentum for sentiment leading into the financial turmoil that began last week."
The current economic conditions index fell to 66.4 in March from 70.7 in February, while the index of consumer expectations dropped to 61.5 from 64.7.
Meanwhile, the report showed decreases in both near-term and long-term inflation expectations, with year-ahead inflation expectations falling to the lowest level since April 2021.
One-year inflation expectations slipped to 3.8 percent in March from 4.1 percent in February, while five-year inflation expectations edged down to 2.8 percent from 2.9 percent.