Consumer inflation fears have reached their highest mark since 1981, according to a survey by the University of Michigan. Americans expect prices to rise by 6.7% over the next year, surpassing the previous record set in 1981.
The survey’s figures have risen significantly since December, when consumers predicted an annual inflation rate of 2.8%. The latest increase is attributed to spiraling fears about President Donald Trump’s campaign of import tariffs, which has led to a decline in consumer confidence.
Consumer sentiment has plummeted, with the University of Michigan’s index falling to 50.8 in April from 57 in March. Economists and financial experts are growing concerned about inflation, with forecasts predicting prices will rise by nearly 4% in 2025.
While economists acknowledge that consumers have been accurate in predicting inflation rates in the past, they warn that flagging consumer confidence can lead to reduced spending, which can negatively impact the economy. The White House has responded to the sagging figures by downplaying concerns, with press secretary Karoline Leavitt citing President Trump’s optimism about a “transition” period for trade deals.
The rise in near-term inflation expectations is driven by tariffs, according to Ryan Sweet, chief U.S. economist at Oxford Economics. Market analysts pay close attention to the Michigan survey on inflation expectations, and experts urge caution as consumers’ fears about inflation can have far-reaching consequences for the economy.
Source: https://eu.usatoday.com/story/money/2025/04/11/inflation-consumer-trump-tariffs-michigan-survey/83047558007