US consumer sentiment drops to lowest in six months

10th May 2024 15:00

(Sharecast News) - Consumer sentiment in the United States dropped to a six-month low in May, according to a closely watched survey from the University of Michigan, falling much more than economists were expecting.

The university's Survey of Consumers showed that the index of consumer sentiment declined to just 67.4 this month, down from 77.2 in April.

This was the lowest level since November 2023 when the index fell to 61.3, and well below the 76.0 reading expected by analysts.

"Consumer sentiment retreated about 13% this May following three consecutive months of very little change," the survey said, adding that the 10 index-point decline was "statistically significant".

The sharp fall followed three straight months of little change, with consumers worried that inflation, unemployment and interest rates may all be moving in an "unfavourable direction" in the year ahead, the university said.

The current economic conditions sub-index fell to 68.8 from 79.0 the month before, while the index of consumer expectations dropped to 66.5 from 76.0.