That’s how many consumers said they’re expecting bad times for business conditions in the year ahead, the most since 2009 and another sign of inflation’s drag on the economy.
Consumers’ confidence in the economy and their finances fell further in June to reach an all-time low, according to the University of Michigan’s Index of Consumer Sentiment, a popular economic indicator that dates to 1952 and is based on a monthly survey. In addition to the 79% of survey respondents expecting bad business conditions in the coming year, 47% blamed inflation for eroding their standard of living—near the highest reading since the Great Recession.
“Consumers across income, age, education, geographic region, political affiliation, stockholding and homeownership status all posted large declines,” said Joanne Hsu, the survey’s director, in a commentary released with the index on Friday.
The survey of at least 500 U.S. households showed that inflation is still a “paramount” concern, as consumers not only expect prices to remain high over the year ahead, but also to continue ticking higher over the long-term. While the Federal Reserve has been raising interest rates in an effort to quell inflation, some economists worry that if consumers don’t lower their expectations about higher prices, regulators could be pressured to raise rates even more aggressively, crimping growth and making consumers gloomier still.
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