US consumer sentiment fell to a four-month low in September, with consumers growing increasingly worried about rising prices and the economic outlook.
The University of Michigan survey released on Friday showed that the final reading of the September consumer sentiment index came in at 48.1, down from the prior month. Consumers expect prices to rise 4.6% over the next year, up from 4% last month. They also anticipate that prices will increase at an annual rate of 3.4% over the next five to ten years, the highest since May.
The deterioration in September consumer sentiment comes as diesel prices hit a record high and gasoline prices are also climbing. Rising fuel costs have compounded the long-standing frustration among American workers over the high cost of living. Inflation remains stubbornly elevated. Prices are rising faster than wages, and mortgage rates have climbed above 7%, making it even harder for many people to achieve homeownership.
"Consumers across the political spectrum unanimously agreed that the economic outlook has worsened," said survey director Joanne Hsu in a statement.
The report showed that confidence has declined this year across all consumer groups by age, education level, region, party affiliation, and income. The gauge measuring the economic outlook for the year ahead dropped sharply in September to its lowest level since 2022. Consumers' expectations for their personal finances also deteriorated. Conditions for purchasing durable goods improved slightly, but Hsu said this was partly "because consumers believe that buying now allows them to avoid paying higher prices in the future."
The consumer expectations index fell to a four-month low, and the current conditions indicator also declined. The survey covered responses received between August 25 and September 21.
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