US consumer sentiment fell in September to a four-month low on growing concerns about the impact of high prices on personal finances.
The final September sentiment index dropped to 55.1 from 58.2 a month earlier, according to the University of Michigan. That compared with a preliminary reading of 55.4.
Consumers expect prices to rise at an annual rate of 4.7% over the next year, data released on Friday showed. That was down slightly from both the preliminary September reading and the prior month. They saw costs rising at an annual rate of 3.7% over the next five to 10 years, up from August.
While sentiment declined among most income groups, it held steady for those with larger holdings of stocks. Equity prices remain close to record highs.
“These differing trends by wealth help provide some insight about the relative resilience in aggregate spending seen in recent months,” Hsu said.
Separate data earlier on Friday showed inflation-adjusted personal spending rose at a solid pace for a third straight month, indicating consumers remain a key source of fuel for the economy. That said, prices remain elevated, job growth is slowing and income growth is moderating.
The combination represents “a challenging situation” for US central bankers, Federal Reserve chair Jerome Powell said on Tuesday.
The survey showed the current conditions gauge fell to 60.4 this month from 61.7 in August, while the expectations index dropped to a four-month low of 51.7.