It’s difficult to describe the U.S. economy in black and white terms like “good” or “bad.” On several fronts, the data says the economy is healthy. But surveys show American consumers don’t feel that way.
“There’s no doubt right now that different data can show slightly different narratives,” says Heather Long, chief economist at Navy Federal Credit Union.
Depending on which measure you look at, inflation is falling or staying flat in recent months, Long points out. The consumer price index has dropped from its 9% peak in June 2022 and hovered around 3% since June 2023, according to U.S. Bureau of Labor Statistics data. Personal consumption expenditures has remained relatively flat for the last year, coming in at 2.9% in December 2025, the latest reading from the Bureau of Economic Analysis.
But prices for many consumer goods remain far above what they were in 2020, and wages have roughly plateaued over that time when adjusted for inflation, according to nonpartisan economic research group, The Hamilton Project. That disparity could be contributing to Americans feeling bad about the economy. Consumer sentiment is down nearly 13% year-over-year as of February, according to the University of Michigan Survey of Consumers, which is released monthly.
