The final read on consumer sentiment in February showed Americans’ feelings about the economy were little changed from January.
But this survey, taken before Friday’s Supreme Court ruling that struck down a wide swath of President Trump’s tariffs, also shows a possible path for sentiment improving if this decision eases pricing pressures.
The University of Michigan’s Index of Consumer Sentiment for February came in at 56.6, up 0.4% from January, but below last year’s level of 64.7. The small increase was lower than the 57.2 reading expected by economists.
“Overall, consumers do not perceive any material differences in the economy from last month,” University of Michigan surveys of consumers director Joanne Hsu said in the release.
This report was also released at the same time the Supreme Court issued its highly anticipated ruling on Trump’s authority to issue tariffs under the International Emergency Economic Powers Act (IEEPA).
That decision showed the Court ruling against the administration, potentially setting the table for easing some tariff-related inflation pressures or even leading to rebate payments to consumers and businesses that paid higher prices as a result of these duties.
And the potential for either direct or indirect relief on tariffs could turn consumer sentiment.
“About 46% of consumers spontaneously mentioned high prices eroding their personal finances; readings have exceeded 40% for seven months in a row,” Hsu said in the release. “Sentiment is about 13% below a year ago and 21% below January 2025.”
This report surveyed consumers before Friday’s announcement. It will also take some time for any impacts from the Supreme Court ruling to work through the economy. But higher prices remain the key stressor for US households, and any relief might push sentiment higher in the months ahead.
Friday’s reading from the University of Michigan also showed inflation expectations improving further, with year-ahead inflation forecasts falling to 3.4% from 4% earlier this month. That’s the lowest since January 2025, but still far higher than the 2.3% to 3% range seen in the two years prior to the pandemic.
Americans still believe long-term inflation is here to stay. It remained at 3.3% this month, higher compared to consistent readings of below 2.8% in 2019 and 2020.
Brooke DiPalma is a reporter for Yahoo Finance. Follow her on X at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.
Click here for the latest stock market news and in-depth analysis, including events that move stocks
Read the latest financial and business news from Yahoo Finance