Lower gas prices perk up poorer Americans' sentiment
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The economic mood across American households improved for the first time in five months as lower gasoline prices offered some relief.
Why it matters: Fuel prices remain one of the fastest ways geopolitical shocks reach American households, making energy costs a key driver of the Trump administration's economic standing.
Driving the news: The University of Michigan's consumer sentiment index climbed four points in June, to 48.9 — the first increase since January.
- The improvement was broad-based, but especially pronounced among lower-income households that spend a larger share of their budgets on gasoline, survey director Joanne Hsu said in a release.
Reality check: The rebound barely dents this year's souring of consumers' mood. Sentiment remains near levels typically associated with severe economic stress.
- Interviews were conducted between May 19 and June 8, before President Trump claimed the U.S. and Iran were "very close" to a deal.
What they're saying: "Views of the economy are still relatively dour," Hsu said.
- Consumers "feel burdened by the recent escalation in inflation and worry that higher inflation could remain stubborn going forward, particularly in the short run."
- Year-ahead inflation expectations eased to 4.6% from 4.8%, but remain well above pre-war levels.
The intrigue: Americans rate inflation, not unemployment, as the bigger threat from the Iran war's economic fallout, the University of Michigan said.
