Michigan consumer sentiment falls to 51 in August, below estimates

Consumer confidence just hit a wall. The University of Michigan’s preliminary August 2026 Consumer Sentiment Index came in at 51.0, falling short of the 54.5 consensus estimate and sliding from July’s final reading of 55.2. The two-month rebound that had briefly calmed nerves? Over. The reading also sits well below August 2025’s level of 58.2, underscoring that the deterioration in how Americans feel about the economy isn’t some seasonal blip. The numbers behind the gloom The Index of Consumer Expectations, which measures how people feel about the future rather than the present, dropped more sharply than the Index of Current Conditions. Survey director Joanne Hsu pointed to a significant deterioration in expected business conditions. Short-term expectations fell 11%, and long-term projections dropped 17%. Perhaps the most striking data point: only 8% of consumers expect their income growth to outpace inflation over the next year. One-year inflation expectations ticked up to 4.3% from 4.2% in July. Back in February 2026, that same figure stood at 3.4%. Long-run inflation expectations, covering the five-to-ten year horizon, held steady at 3.3%. A bumpy 2026 so far This year has been ...