U.S. consumer sentiment falls to a fresh record low in early May as gas prices rise

U.S. consumer sentiment fell to a fresh record low in early May, weighed down by inflation concerns and higher gasoline prices, according to the University of Michigan’s preliminary Survey of Consumers released Friday.

The survey’s headline reading came in at 48.2, down 3.2% from April’s prior record low and 7.7% from a year earlier. Economists had expected 49.7.

The decline was driven by broad worries about high prices, which respondents said were straining personal finances and making major purchases feel less feasible. About one-third of respondents cited gasoline prices as their primary concern.

National average gasoline prices were $4.54 per gallon on Friday, up nearly 40 cents from the previous month and about $1.40 higher than a year ago.

Expectations and inflation outlook

Despite the overall drop in sentiment, the expectations index edged up. It rose 0.8% from April to 48.5 and was 1.3% higher than a year earlier.

Inflation expectations eased slightly but remained elevated. The one-year inflation outlook was 4.5%, down 0.2 percentage point, while the five-year outlook was 3.4%, down 0.1 percentage point.

U.S. stock indexes stayed positive asourceser the report was released.