US February prelim UMich consumer sentiment 67.8 vs 71.1 expected

• Lowest reading since July 2024
• Prior was 71.1
• Current conditions 68.7 vs 73.0 expected
• Expectations 67.3 vs 70.0 expected
• 1-year inflation 4.3% vs 3.3% prior
• 5-year inflation 3.3% vs 3.2% prior

One-year inflation expectations jumped in January to the highest since Nov 2023. That’s obviously tariff fears but the fed might take some comfort in more-stable longer-term inflation expectations.

I think the bigger takeaway may be the headline. The post-election glow hasn’t lasted long and it was similar in ISM services this week.

“The decrease was pervasive, with Republicans, Independents, and Democrats all posting sentiment declines from January,” survey director Joanne Hsu said. “Many consumers appear worried that high inflation will return within the next year.”

Interviews concluded on Feb 4, which was the day after the tariff fight ended (at least this round). I wonder if the White House takes this as a message to cool it on the tariff talk.

This article was written by Adam Button at www.forexlive.com.