Consumer sentiment fell to 44.8, down from 49.8 in April, according to a preliminary reading of the University of Michigan Consumer Sentiment Index for May — dropping lower than it did during the worst of the Great Recession and when the entire country was locked down during the COVID-19 pandemic.
Consumer sentiment is now down 10% from a month ago and more than 14% from a year ago.
This is the third straight month that consumer sentiment has fallen amid disruptions in oil supply from the Strait of Hormuz that have caused oil and gasoline prices to rise and have added further to the dissatisfaction that consumers are feeling with affordability.
“The cost of living continues to be a first-order concern, with 57% of consumers spontaneously mentioning that high prices were eroding their personal finances, up from 50% last month,” said Joanne Hsu, the survey director.
“Lower-income consumers and those without college degrees posted particularly strong sentiment declines; these groups are more sensitive to increases in the cost of gas and other essentials,” she added.
