U.S. Final June Michigan Consumer Sentiment Rises to 49.5 as Gasoline Prices Ease

U.S. consumer sentiment in June came in above the initial estimate, supported by a pullback in gasoline prices. According to Jin10, the University of Michigan’s final June consumer sentiment index was 49.5, up from a preliminary reading of 48.9 and about 10% higher than May. The report said sentiment improved across consumers of different income and wealth levels and across political affiliations. Expectations for business conditions over the next five years rose 16%, suggesting consumers’ concerns about the long-term consequences of the Iran conflict were easing. However, the sentiment index remained in an unfavorable range, standing 13% below the February 2026 level recorded before the Iran conflict began and nearly 20% lower than a year earlier. The cost of living remained consumers’ top concern. For a third consecutive month, more than half of respondents said high prices were weighing on their personal finances. Inflation expectations for the next year edged down to 4.6% in June from 4.8% in May, but remained elevated. The June reading was well above the 3.4% level in February before the Iran conflict began and higher than any reading recorded during 2024. Longer-term inflation expectations fell to 3.3% in June from 3.9% the prior month, and remained slightly above the 2.8% to 3.2% range seen in 2024.