Consumer Sentiment Falls to a Record Low on Inflation Concerns

• UMich Consumer Sentiment Index fell to a record-low 47.6, below the estimated 51.5.
• One-year inflation expectations rose to 4.8% from 3.8%, driven by a 21.2% increase in gasoline prices in March.
• Consumer spending has already shown signs of decline in Q4 GDP numbers and recent PCE reports, indicating a potential pullback due to high prices.

The University of Michigan Consumer Sentiment Index has fallen to a record low of 47.6, significantly below the estimated 51.5. This decline is attributed to surging gasoline prices, which rose 21.2% in March, and broader inflation concerns. The low sentiment, even worse than during COVID lockdowns, suggests consumers are pulling back on spending, potentially impacting future economic growth.