“Consumer sentiment was essentially unchanged this month, inching down a scant 1.4 index points following four consecutive months of steep declines. Sentiment is now down almost 30 percent since January 2025. Slight increases in sentiment this month for independents were offset by a 7 percent decline among Republicans. While most index components were little changed, current assessments of personal finances sank nearly 10 percent on the basis of weakening incomes. Tariffs were spontaneously mentioned by nearly three-quarters of consumers, up from almost 60 percent in April, uncertainty over trade policy continues to dominate consumers’ thinking about the economy.”

“Note that interviews for this release were conducted between April 22 and May 13, closing two days after the announcement of a pause on some tariffs on imports from China. Many survey measures showed some signs of improvement following the temporary reduction of China tariffs, but these initial upticks were too small to alter the overall picture – consumers continue to express somber views about the economy. The initial reaction so far echoes the very minor increase in sentiment after the April 9 partial pause, despite which sentiment continued its downward trend.”

“Year-ahead inflation expectations surged from 6.5 percent last month to 7.3 percent this month. This month’s rise was seen among Democrats and Republicans alike. Long-run inflation expectations lifted from 4.4 percent in April to 4.6 percent in May, reflecting a particularly large monthly jump among Republicans. The final release for May will reveal the extent to which the May 12 pause on some China tariffs leads consumers to update their expectations,” says the University of Michigan Survey of Consumers in a statement, finding that even GOP voters are starting to feel “somber.”