Consumer sentiment in the U.S. has unexpectedly seen a continued improvement in the month of February, according to preliminary data released by the University of Michigan on Friday.
The University of Michigan said its consumer sentiment index rose to 57.3 in February after jumping to 56.4 in January. Economists had expected the index to dip to 55.5.
With the unexpected increase, the consumer sentiment index reached its highest level since hitting 58.2 in August 2025.
The unexpected uptick by the consumer sentiment index came as sentiment surged among consumers with the largest stock portfolios.
“While sentiment is currently the highest since August 2025, recent monthly increases have been small—well under the margin of error—and the overall level of sentiment remains very low from a historical perspective,” said Surveys of Consumers Director Joanne Hsu.
She added, “Concerns about the erosion of personal finances from high prices and elevated risk of job loss continue to be widespread.”
The report said the current economic conditions index climbed to 58.3 in February from 55.4 in January, while the index of consumer expectations edged down to 56.6 in February from 57.0 in January.
With regard to the outlook for inflation, the University of Michigan said year-ahead inflation expectations tumbled to 3.5 percent in February from 4.0 percent in January.
Year-ahead inflation expectations dropped to their lowest level since January 2025 but still exceed the readings seen in 2024 and the 2.3-3.0 percent range seen in the two years pre-pandemic.
Meanwhile, the report said long-run inflation expectations inched up for the second straight month, ticking up to 3.4 percent in February from 3.3 percent in January.
“In comparison, readings ranged between 2.8% and 3.2% in 2024, and were below 2.8% throughout 2019 and 2020,” Hsu said.
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