APRIL 28, 2025 – CONSUMER SENTIMENT UP SLIGHTLY FROM MID-MONTH
The Consumer Sentiment Index came in at 52.2 for April. Better than the reading of 50.8 two weeks ago, but still down from 57.0 in March. US consumer sentiment is down for a fourth straight month, primarily due to concerns about the economic impact of tariffs. Consumers are pessimistic about the labor market and the direction of the economy.
12-month inflation expectations are 6.5 percent, down from 6.7 percent earlier in April, up from 5.0 percent in March. Inflation expectations remain the highest since 1981, and it is the fourth consecutive month of large rises of 0.5 percentage points or more. Long-run inflation expectations are 4.4 percent, up from 4.1 percent in March. Concerns over tariffs and their economic fallout have further raised fears of a recession.
The Fed will meet next week on May 6-7, when it is expected the Fed will maintain their ‘wait and see’ approach given the recent market volatility and inflation worries. It is likely they will wait to give any firm guidance on the direction of rates, preferring to wait for more data.