U.S. Consumer Sentiment Drops Less Than Previously Estimated In September

(RTTNews) - Revised data released by the University of Michigan on Friday showed consumer sentiment in the U.S. deteriorated by less than previously estimated in the month of September.

The University of Michigan said its consumer sentiment index for September was upwardly revised to 48.1 from a preliminary reading of 47.8.

Economists had expected index to be unrevised from the preliminary reading, although the upwardly revised reading is still down from 51.7 in August.

The monthly decrease by the headline index came as the index of consumer expectations slumped to 46.3 in September from 51.5 in August.

"The short-run outlook for business conditions plunged amid renewed worries that elevated fuel prices and re-escalating trade disputes could pass through to the economy as a whole," said Surveys of Consumers Director Joanne Hsu,

"Overall, interviews reveal broad agreement across the political spectrum that the outlook for the economy has weakened since the beginning of the year," she added. "After particularly large declines in sentiment this month, Republican sentiment is now 20% lower than January 2026."

The report showed a more modest decrease by the current economic conditions index, which dipped to 50.9 in September from 51.9 in August.

On the inflation front, the University of Michigan said year-ahead inflation expectations jumped to 4.6 percent in September from 4.0 percent in August.

Year-ahead inflation expectations reached their highest level since June and substantially exceed the 3.4 percent seen in February before the Iran conflict began, along with all 2024 readings.

The report also said long-run inflation expectations ticked up to 3.4 percent in September after three consecutive months at 3.3 percent. These expectations remain higher than their 2024 range of 2.8 to 3.2 percent.