Consumer sentiment drops as inflation expectations jump
The University of Michigan's consumer sentiment index dropped thanks in part to a big uptick in inflation expectations.
The index's preliminary May reading came in at 67.4. That's well below a Dow Jones estimate of 76 and under the 77.2 reading for April.
"This 10 index-point decline is statistically significant and brings sentiment to its lowest reading in about six months," Surveys of Consumers Director Joanne Hsu said in a statement.
"While consumers had been reserving judgment for the past few months, they now perceive negative developments on a number of dimensions. They expressed worries that inflation, unemployment and interest rates may all be moving in an unfavorable direction in the year ahead," Hsu added.
Year-ahead inflation expectations jumped to 3.5% from 3.2%. Long-run estimates also went up to 31% from 3%.