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Consumer confidence plunged to a record low in April as fears mounted over rising energy prices and the broader impact of the Iran war, according to a University of Michigan survey Friday.<\/p>\n
The university’s headline index of consumer sentiment tumbled to 47.6, down 10.7% from the March survey to its lowest on record. Current conditions and expectations indexes also saw double-digit monthly declines.<\/p>\n
The drop in sentiment coincided with a sharp spike in inflation expectations, with respondents seeing prices up 4.8% in a year from now, a full percentage point rise from the March reading to its highest since August 2025. The one-year outlook in April 2025 was 6.5% following President Donald Trump<\/a>‘s “liberation day” tariff announcement.<\/p>\n Survey comments “show that many consumers blame the Iran conflict for unfavorable changes to the economy,” said the survey’s director, Joanne Hsu.<\/p>\n However, Hsu also noted that most of the interviews were completed before the April 7 ceasefire. The survey, then, primarily reflects conditions from March.<\/p>\n “Economic expectations will likely improve after consumers gain confidence that the supply disruptions stemming from the Iran conflict have ended and gas prices have moderated,” she said.<\/p>\n The survey release came shortly after the Bureau of Labor Statistics reported that its all-items consumer price index rose 0.9% in March, pushing the 12-month inflation rate to 3.3%. BLS officials said most of the increase in the headline number came from the surge in energy prices, with food inflation little changed.<\/p>\n Inflation expectations at the five-year window in the University of Michigan survey moved higher as well, to 3.4%, a 0.2 percentage point monthly increase though a percentage point below the level of a year ago.<\/p>\n Clarification: The first version of the survey is released in April but largely covers conditions in March. An earlier version did not make that point clearly.<\/p>\n