US consumer sentiment experienced its sharpest decline since the 1990 recession in April, largely due to trade policy uncertainties and inflation concerns. According to the University of Michigan’s Institute for Social Research, the index of consumer sentiment dropped by 32% since January. Joanne Hsu, director of the surveys of consumers, noted that expectations worsened across demographics due to uncertainties surrounding trade policies and potential inflation increases. In April, the index fell to 52.2 from 57 in March. Inflation expectations surged from 5% in March to 6.5% in April, the highest since 1981. Despite President Trump’s claims that tariffs would boost the economy, consumer confidence remains low. Although markets rallied after Trump suggested a reduction in Chinese tariffs, consumer inflation expectations remained elevated compared to March. Slower income growth anticipations paired with higher inflation expectations may lead to reduced spending and a potential economic slowdown.
— new from The Guardian
