US consumer confidence dips, inflation expectations surge
By Alexander Bueso
Date: Friday 07 Feb 2025
(Sharecast News) - Consumer confidence in the US dipped slightly, amid concern around the impact of tariffs on the cost of purchasing durable goods, preliminary survey data showed.
The University of Michigan's consumer confidence index for the month of February dipped from a reading of 71.1 for the month of January to 67.8 in February.
Significantly, inflation expectations one-year ahead registered jumped by a full percentage point to 4.3%.
It was just the fifth time in 14 years that a gain of one percentage point or more had been registered in a single month.
Survey director Joanne Hsu said the worsening in the headline consumer sentiment index was led by a 12% drop in a sub-index linked to buying conditions for durables.
Hsu linked that to "a perception that it may be too late to avoid the negative impact of tariff policy."
"Expectations for personal finances sank about 6% from last month, again seen across all political affiliations, reaching its lowest value since October 2023," she added.
"Many consumers appear worried that high inflation will return within the next year. Interviews for this release concluded on February 4."
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