Consumer sentiment fell to 48.1 in September, according to the University of Michigan’s Surveys of Consumers. August stood at 51.7. A year ago it was 55.1.
That puts the index 15% below where it started 2026. Set against a decade ago the gap is wider: in 2016 the reading was in the low 90s, roughly 40 points higher.
Prices, fuel and tariffs
People are feeling it in their own accounts. Views of both current personal finances and finances over the next year weakened by about 10% this month. About 55% said high prices were hurting them, up from 53% in August and 44% a year earlier.
Fuel is back on the list. Gasoline had eased for two straight months, yet 31% of consumers raised it unprompted in September. “Consumers do not believe that relief from high gas prices is on the horizon; they broadly expect gasoline prices to continue rising in both the short and long run,” said Joanne Hsu, the survey’s director.
Tariffs are a growing worry too. The share who mentioned them without being asked rose for a second month, from 24% in July to 35% in September. “Short-run expected business conditions plunged amid renewed worries that elevated fuel prices and reescalating trade disputes could pass through to the economy as a whole,” Hsu said.
Borrowing costs bite
Buyers of homes and cars face another hurdle. Buying conditions for homes declined, and interest rates overtook high prices as buyers’ top concern. Higher borrowing costs also weighed on those thinking about a vehicle.
The gloom crosses party lines. Researchers found cost-of-living worries widespread whatever the respondent’s affiliation, and Republican sentiment is now 20% below January and under its historical average.
Paychecks are part of it. In August, only 8% expected their income to grow faster than inflation over the next year. Looking ahead, the Expectations Index dropped from 51.5 in August to 46.3 in September.
