Packaged of ground beef are displayed at a Safeway store on May 02, 2024 in San Anselmo, California.
Justin Sullivan | Getty Images
Consumer sentiment slumped as inflation expectations rose, despite otherwise strong signals in the economy, according to a closely watched survey released Friday.
The University of Michigan Survey of Consumers sentiment index for May posted an initial reading of 67.4 for May, down from 77.2 in April and well off the Dow Jones consensus call for 76. The move represented a one-month decline of 12.7% but a year-over-year gain of 14.2%.
Along with the downbeat sentiment measure, the outlook for inflation across the one- and five-year horizons increased.
The one-year outlook jumped top 3.5%, up 0.3 percentage point from a month ago to the highest level since November 2023.
Also, the five-year outlook rose to 3.1%, an increase of just 0.1 percentage point but reversing a trend of lower readings in the past few months, also to the highest in November.
Other indexes in the survey also posted substantial declines: The current conditions index fell to 68.8, down more than 10 points, while the expectations measure fell to 66.5, down 9.5 points. Both pointed to monthly drops of more than 12%, though they were higher from a year ago.
This is breaking news. Please check back for updates.