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Extract original preliminary and final results with publication dates and validated table headers. Add annual report discovery and real report fixtures covering cross-month releases and PDF text layout differences.
78 lines
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78 lines
4.5 KiB
Plaintext
© The University of Michigan, 2025. All rights reserved.
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Monitoring trends for over 75 years
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July 2025 survey results August 1, 2025
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Joanne Hsu, PhD, Director
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Consumer sentiment improved for the second straight month, inching up
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a scant single index point from June. Current conditions rose about 5% to
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its highest reading since February 2025, while the expectations index fell
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slightly. A rise in sentiment among stock holders was partially offset by a
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decline among consumers who do not own stocks . Perceptions of this
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month’s economic developments were similar across the political
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spectrum; Republicans, Independents, and Democrats all saw some minor
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increases in sentiment this month. Although recent trends show sentiment
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moving in a favorable direction, sentiment remains broadly negative.
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Consumers are hardly optimistic about the trajectory of the economy, even as their worries have softened since April 2025.
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Year-ahead inflation expectations fell for a second straight month, plunging from 5.0% last month to 4.5% this month. This
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is the lowest reading since February 2025 but above December 2024 just after the election. Long-run inflation expectations
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receded for the third consecut ive month, falling back from 4.0% in June to 3.4% in July. This is the lowest reading since
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January 2025 but, again, still considerably higher than the December 2024 reading.
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Labor market expectations improved just a touch but remain considerably weaker than a year ago. About 57% of consumers
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expect unemployment to rise in the year ahead, down from the two-thirds seen in March and April, but well above the 35%
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seen a year ago (see chart, red solid line). Aside from the last five months, this is the highest reading since 2009. Moreover,
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consumers continue to perceive elevated risks of personal job loss (see chart, black dotted line). Expectations of own
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incomes remain extremely low and are less than half of what was seen in December 2024.
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Sentiment this year has tracked the salience of tariffs to consumers. The share of consumers spontaneously offering
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comments about tariffs has fallen from a height of two-thirds of consumers in May to 57%, still a solid majority, in July.
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While tariff policy appears to be stabilizing below the levels threatened in April, recent announcements include tariff rates
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that are still very high from a historical perspective. Tariff concerns are particularly strong among higher -income, high-
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stock-wealth, and college-educated consumers. These consumers note that their personal finances have been boosted by
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strong asset values, but their personal views of the economy are still relatively gloomy, which presents its own risks given
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their large contribution to aggregate spending.
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Overall, the survey reveals risks to both of the Fed’s mandates. While inflation expectations have fallen considerably from
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the initial shock of the April tariff threats, they remain notably higher than the pre-pandemic period. Consumers clearly do
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not believe that the risk of accelerating inflation has passed. Meanwhile, expectations remain poor for business conditions
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and elevated for unemployment; critically, consumers anticipate they may be personally affected. Despite recent
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improvements, this combination of views is consistent with a slowdown in spending, as consumers may respond to these
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risks with more cautious financial behavior. At the same time, a cautionary pullback in spending could potentially mediate
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any inflationary effects of tariffs.
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Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul
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2024 2024 2024 2024 2024 2024 2025 2025 2025 2025 2025 2025 2025
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Index of Consumer Sentiment 66.4 67.9 70.1 70.5 71.8 74.0 71.7 64.7 57.0 52.2 52.2 60.7 61.7
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Current Economic Conditions 62.7 61.3 63.3 64.9 63.9 75.1 75.1 65.7 63.8 59.8 58.9 64.8 68.0
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Index of Consumer Expectations 68.8 72.1 74.4 74.1 76.9 73.3 69.5 64.0 52.6 47.3 47.9 58.1 57.7
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Index Components
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Personal Finances - Current 79 79 80 81 82 85 87 82 74 71 67 78 83
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Personal Finances - Expected 105 108 111 110 116 111 109 99 86 78 79 94 91
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Economic Outlook - 12 Months 86 88 93 92 97 88 81 73 56 48 50 63 66
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Economic Outlook - 5 Years 84 92 94 95 96 94 88 83 66 60 60 74 72
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Buying Conditions - Durables 81 78 82 85 82 108 106 86 89 82 83 88 91
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25
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0
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60
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70
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80
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1997 2001 2005 2009 2013 2017 2021 2025
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Probability of Losing a Job During the
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Next 5 Years (3-Month Movng Average)
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% of Consumers Expecting More Unemployment
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During the Next Year (3-Month Moving Average)
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Despite Recent Improvements, Consumers Still
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Anticipate Rising Unemployment and Elevated
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Risks of Personal Job Loss
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