The preliminary Index of Consumer Sentiment was 55.5 in March, falling from 56.6 in February and registering its lowest level this year. During the month, concerns centered on the U.S.-Iran war and elevated gas prices.
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New trading tool for QQQ bulls“Interviews completed prior to the military action in Iran showed an improvement in sentiment from last month, but lower readings seen during the nine days thereafter completely erased those initial gains,” said Surveys of Consumers Director Joanne Hsu.
Gas Prices Surge as Inflation Expectations Shift
The average price for a gallon of gas in the U.S. has risen by 22% to $3.63 since the start of the war on February 28. Consumers have felt the pressure at the pump and expect year-ahead inflation of 3.4%. That remains unchanged from February but snapped a six-month streak of falling expectations.
Furthermore, long-run inflation expectations edged down to 3.2% from 3.3%, potentially signaling that consumers expect the inflationary effects of the war to be temporary.