U.S. consumer sentiment fell to a record low in early April as inflation concerns tied to the Iran conflict intensified, while new data showed a sharp rise in consumer prices driven largely by gasoline costs.

• The University of Michigan’s preliminary sentiment index dropped to 47.6 in April from 53.3 in March, one of the lowest readings on record.

• Consumers expect inflation of 4.8% over the next year, up 1 percentage point from March, marking the largest increase in a year.

• Long-term inflation expectations rose to 3.4% over the next 5–10 years.

• The current conditions index fell to 50.1, while expectations dropped to their lowest level since 1980.

• The consumer price index rose 0.9% in March, the largest monthly increase in nearly four years, with gasoline accounting for nearly three-quarters of the gain.

• Annual inflation accelerated to 3.3%, the fastest pace since 2024.

• Gas prices climbed above $4 per gallon, reaching their highest levels since 2022 amid Middle East supply disruptions.

• Airfares rose 2.7% in March, while services prices excluding energy increased 0.2%.

• Real average hourly earnings rose 0.3% year-over-year, the slowest pace since 2023.

Written by: Matthew Kerr @Quiver Quantitative

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