Shopper sentiment fell for the fifth straight month, and President Donald Trump’s determination to reverse some tariffs has not improved the general public temper.

The Michigan Shopper Sentiment Survey declined once more in Might to 50.8, the second-lowest sentiment reading within the survey’s historical past. The report’s carefully adopted inflation projections confirmed customers anticipated costs to rise by 7.3% over the subsequent yr. It’s the very best inflation expectation since 1981.

Economists anticipated a slight rebound in sentiment this month amid optimism about trade negotiations and the first agreements being reached. Shopper sentiment has plunged to date this yr on worries that import taxes would increase costs.

Survey Doesn’t Totally Seize U.S.-China Commerce Deal

Whereas the preliminary readings for Might seize the interval after Trump issued a 90-day pause on many tariffs on April 9, the survey solely covers two days after the White Home introduced a tariffs agreement with China on May 12. 

“Many survey measures confirmed some indicators of enchancment following the non permanent discount of China tariffs, however these preliminary upticks had been too small to change the general image—customers proceed to specific somber views concerning the economic system,” wrote Michigan Survey of Customers Director Joanne Hsu.

Sentiment surveys have proven that buyers are worrying about the direction of the economy within the face of upper U.S. tariffs. However to date, the “soft data” fears expressed by customers haven’t proven up within the “laborious information” of retail sales and different financial measurements.

“Should you took them at face worth People could be crashing the economic system by spending subsequent to nothing, however retail gross sales rose final month, although barely,” wrote Navy Federal Credit score Union Company Economist Robert Frick.  “What this does inform us is customers are so on edge {that a} contraction within the labor market or in incomes might simply shock client spending and push us into recession.”