FX.co ★ US Consumer Sentiment Tumbles in August

In August 2025, the University of Michigan reported a decline in consumer sentiment in the United States, with the index falling to 58.6 from 61.7 in July, missing market predictions of 62. This marked the first drop in four months, primarily driven by heightened concerns over inflation and significantly poorer conditions for purchasing durable goods. Although there was a slight improvement in the outlook for personal finances, there remains a widespread expectation of worsening inflation and increased unemployment. The index for current conditions fell to 60.9 from 68, while the expectations index decreased to 57.2 from 61.7. Additionally, inflation expectations for the upcoming year rose to 4.9% from 4.5%, and long-term expectations increased to 3.9% from 3.4%. This month signified the end of two months of declining short-term inflation expectations and three months for long-term projections; however, both figures are still significantly lower than the peaks observed in April and May 2025.