April 11, 2026
"Many consumers blame the Iran conflict for unfavorable changes to the economy,” the survey’s director, Joanne Hsu, wrote in a report about the survey. Consumers responded by saying they now expect inflation to rise 4.8% in the next year, a full percentage point jump from March’s survey.
Consumer sentiment is a closely watched economic indicator given that consumer spending accounts for roughly two-thirds of America’s gross domestic product each year. The University of Michigan consumer sentiment index previously registered a 6% decline in March, with declines seen across all ages and political parties,
The University of Michigan index reading was even lower than it was during 2008’s Great Recession when consumers were forced to confront harsh economic conditions that resulted from massive defaults in the housing and financial sectors and was also lower than it was during former President Joe Biden’s administration, when inflation peaked at 9.1% following the passage of massive spending bills on COVID and the climate.
The consumer price index increased 0.9% in March, pushing the annual inflation rate to 3.3%, largely due to a 10.9% spike in energy costs resulting from the war in Iran.
The annual rate reading was the largest recorded since April 2024 and increased from 2.4% in February, CNBC reported. Gasoline prices skyrocketed by 21.2% in March as the Strait of Hormuz, a major route for shipping oil, remains largely closed due to the war, accounting for three-quarters of the inflation increase.
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