08/19/2025

Consumer Sentiment Worsened in August amid Sweeping New Tariffs

The report comes days after a lower-than-expected inflation reading

Consumer sentiment worsened in August, snapping two consecutive months of improved attitudes among shoppers as President Donald Trump imposed sweeping new tariffs on nearly 70 countries. The fresh reading fell short of economists' expectations.

The dampening of shopper attitudes returns the measure to a months-long downturn that took hold after Trump took office, University of Michigan Survey data on Friday showed. At its low point, consumer sentiment fell close to its worst level since a bout of inflation three years ago. The measure remains below where it stood in December, before Trump took office.

Year-ahead inflation expectations rose from 4.5 percent last month to 4.9 percent this month, the data showed. The outcome anticipated by respondents would put inflation well above its current level of 2.7 percent. The heightened inflation expectation occurred across people of all political affiliations, the survey said.

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