Consumer Sentiment Reaches Five-Month High in Early July

Consumer Sentiment Up in Early July 

Ann Arbor, MI, July 18, 2025-U.S. consumer sentiment reached its highest value in five months in early July, inching up about one index point to 61.8, according to preliminary results from the University of Michigan Survey of Consumers.

It remains 16% below December 2024 and is significantly below its historical average, the report states. Short-run business conditions improved about 8%, whereas expected personal finances fell back about 4%. 

“Consumers are unlikely to regain their confidence in the economy unless they feel assured that inflation is unlikely to worsen, for example, if trade policy stabilizes for the foreseeable future,” says Survey of Consumers Director Joanne Hsu. “At this time, the interviews reveal little evidence that other policy developments, including the recent passage of the tax and spending bill, moved the needle much on consumer sentiment. 

“Year-ahead inflation expectations fell for a second straight month, plunging from 5.0% last month to 4.4% this month. Long-run inflation expectations receded for the third consecutive month, falling back from 4.0% in June to 3.6% in July. Both readings are the lowest since February 2025 but remain above December 2024, indicating that consumers still perceive substantial risk that inflation will increase in the future.”