Consumer Sentiment Declined 2.7% to 53.6 in October

Ann Arbor, MI, October 24, 2025-Consumer sentiment declined 2.7% to 53.6 in October, reports the University of Michigan Survey of Consumers.

This represents a 24% decline year over year.

“Consumer sentiment was little changed this month, slipping a scant 1.5 index points from September,” according to director Joanne Hsu. “A modest increase in sentiment among younger consumers was offset by decreases among middle-age and older consumers. Current personal finances inched up, while expected personal finances receded. Overall, consumers perceive few material changes in economic circumstances from last month; inflation and high prices remain at the forefront of consumers’ minds. There was little evidence this month that consumers connect the federal government shutdown to the economy. Only about 2% spontaneously referenced the shutdown during this month’s interviews, compared with the 10% of consumers who did so in January 2019 during that 35-day shutdown. 

“Year-ahead inflation expectations ebbed from 4.7% last month to 4.6% this month. These expectations are currently midway between the readings seen a year ago and the highs seen this year in May in the wake of the initial announcements of major tariff changes. Long-run inflation expectations increased from 3.7% last month to 3.9% this month but remains below this year’s high point seen in April. This month’s increase in long-run inflation expectations was driven primarily by independents and Republicans. Inflation uncertainty-as measured by the interquartile range of expectations-ticked up for both time horizons this month.”