Consumer sentiment hit a record low in June as Americans continued to face elevated prices for gas, food, and other goods and services.
The University of Michigan’s closely watched Surveys of Consumers consumer sentiment index was revised lower to 50.0 in the final June survey.
This marked the lowest level on record in data for the series, which spans back to the mid-1970s. In the preliminary monthly survey, the index registered 50.2.
Inflation, which last increased at the fastest pace in more than 40 years as of May, remained a pressing concern and a key contributor to the further erosion in sentiment.
“The final June reading confirmed the early-June decline in consumer sentiment … Consumers across income, age, education, geographic region, political affiliation, stockholding and homeownership status all posted large declines,” Joanne Hsu, director of the Surveys of Consumers, said in a statement.
“About 79% of consumers expected bad times in the year ahead for business conditions, the highest since 2009,” Hsu added. “Inflation continued to be of paramount concern to consumers; 47% of consumers blamed inflation for eroding their living standards, just one point shy of the all-time high last reached during the Great Recession.”
The final consumer sentiment index for June represented a marked decline from May’s reading of 58.4.
Inflation expectations for the year ahead remained elevated at 5.3%, while long-run inflation expectations moderated, falling to 3.1% from the preliminary report’s 3.3%.
Mahir Rasheed, US Economist, at Oxford Economics, said this decline in long-run inflation expectations was “encouragingly lower” than the preliminary reading, noting that Fed chair Jerome Powell called this figure “quite eye-catching” in testimony earlier this week. Rasheed notes, however, this “remains the highest expected long-run rate of the current cycle.”
The University of Michigan’s print also came following a number of other reports pointing to a deterioration in key parts of the US economy and a slide in sentiment among businesses. The preliminary S&P Global Composite Purchasing Managers’ Index (PMI) for June came in at 51.2, the weakest level since January, and S&P’s manufacturing output index slid into contractionary territory and a two-year low.
Business confidence has slumped to “a level which would typically herald an economic downturn, adding to the risk of recession,” Chris Williamson, chief business economist at S&P Global Market Intelligence, said Thursday.
Last week, a Conference Board survey found that 60% of CEOs said they expect a recession before the end of 2023. Economics teams at Wall Street firms from Goldman Sachs to Citigroup have also raised their expectations for the risk of a recession over the next year, mostly due to their anticipation that the Federal Reserve would have to keep hiking interest rates swiftly to bring down inflation.
Consumers also still expect inflation to remain elevated, though one-year inflation expectations were revised slightly lower in the latest print. The University of Michigan’s revised data showed consumers anticipate inflation will rise 5.3% versus the 5.4% previously reported, which had matched March and April’s readings for the highest since 1981.
“Consumers also expressed the highest level of uncertainty over long-run inflation since 1991, continuing a sharp increase that began in 2021,” Hsu said.
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter.
This story originally Appeared on Yahoo