04/11/2025

Tariff Angst Sinks U.S. Consumer Sentiment

Consumer sentiment plunged to near a three-year low in April

U.S. consumer sentiment deteriorated sharply in April and 12-month inflation expectations surged to the highest level since 1981 amid unease over escalating trade tensions that have roiled financial markets and raised the risk of a recession.

The University of Michigan Surveys of Consumers said on Friday that the slump in sentiment to the lowest level in nearly three years was "pervasive and unanimous" across age, income, education, geographic region and political party affiliation.

The jump in inflation expectations poses a dilemma for Federal Reserve officials, who have argued they remain anchored. President Donald Trump this week ratcheted up trade tensions, hiking duties on Chinese goods to 125 percent, even as he delayed reciprocal tariffs on other trade partners for 90 days.

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