University of Michigan: Consumer Sentiment Improves in June

HOUSTON, TX (DTN) – U.S. consumer sentiment improved in June, with the Index of Consumer Sentiment rising 4.1 points to 48.9, according to preliminary data from the University of Michigan’s Surveys of Consumers released Friday (6/12) morning. Last month, soaring energy costs sparked by the ongoing U.S.-Israeli war on Iran led the index to plummet to 44.8, the first sub-50 reading in the survey’s history.

The Current Economic Conditions Index, measuring sentiment about personal finances and buying conditions, increased 2.6 points, or 5.7%, to 48.4 from May. Year-on-year, the index dropped 25.3%.

The Index of Consumer Expectations, which reflects the economic outlook over the next 12 months, rose by 5.2 points to 49.3 month-over-month. This is the second month, the index fell below the 50-point mark for the first time since May 2025.

“Even with June’s early gains, however, views of the economy are still relatively dour. Sentiment is currently 13% below January 2026 and 19% below a year ago, as consumers remain focused on kitchen table issues,” said Surveys of Consumers Director Joanne Hsu.

According to Hsu, consumers feel burdened by the recent escalation in inflation and are concerned that elevated inflation will remain high in the short run.

Year-ahead inflation expectations inched down from 4.8% in May to a still-elevated 4.6% this month. The current reading substantially exceeds the 3.4% reading seen in February 2026 prior to the start of the Iran conflict, along with all 2024 readings, the report stated. Long-run inflation expectations fell back to 3.4% in June from 3.9% in May, remaining notably higher than the 2.8% to 3.2% range seen in 2024.