US Consumer Confidence Drops to Historic Low in May

SadaNews - A survey published yesterday evening showed that American consumer confidence dropped to a historic low in May, amid rising concerns about increasing gasoline prices due to the war with Iran, alongside a deterioration in households' purchasing power.

According to the University of Michigan's consumer survey, the consumer confidence index fell to 44.8 points, the lowest level on record, compared to 48.2 points in the previous reading for the month and 49.8 points in April. The result also fell short of economists' expectations, who had predicted the index would remain stable at 48.2 points, according to a Reuters survey.

Joan Hsu, the survey director, said, "The cost of living remains a major concern, as 57% of consumers indicate that rising prices negatively impact their personal financial situations, compared to 50% last month." She added that "independents and Republicans recorded a decline in morale, reaching their lowest levels during the current administration."

In the same context, consumers' inflation expectations for the coming year rose to 4.8%, up from 4.7% in April, and long-term inflation expectations (five years) increased to 3.9%, from 3.5% in the previous month.