After reporting U.S. consumer sentiment at a fourteen-year high in the previous month, the University of Michigan released a report on Friday showing sentiment has pulled back by much more than expected in the month of April.
The report said the preliminary reading on the consumer sentiment index for April came in at 97.8 compared to the final March reading of 101.4. Economists had expected the index to edge down to 100.5.
“Consumer sentiment slipped in early April, largely reversing the gains recorded in the prior two months,” said Richard Curtin, the survey’s chief economist. “The small decline was widely shared by all age and income subgroups and across all regions of the country.”
He added, “Importantly, confidence still remains relatively high, despite the recent losses that were mainly due to concerns about the potential impact of Trump’s trade policies on the domestic economy.”
The bigger than expected decrease by the headline index was partly due to a notable drop by the current economic conditions index, which slumped to 115.0 in April from 121.2 in March.
The report said the index of consumer expectations also slipped to 86.8 in April from 88.8 in the previous month.
On the inflation front, one-year inflation expectations edged down to 2.7 percent in April from 2.8 percent in March, while five-year inflation expectations dipped to 2.4 percent from 2.5 percent.