NEW YORK – Consumer sentiment tumbled to a nine-month low in April, with Americans especially gloomy about the long-term health of the economy, a survey released on Friday showed.
The Thomson Reuters/University of Michigan's preliminary reading on the overall index of consumer sentiment fell to 72.3 in April, a level last seen in July, 2012, and below economists' forecasts of 78.5. The index stood at 78.6 last month.
The barometer of current economic conditions fell to 84.8 this month from 90.7, while the gauge of consumer expectations hit 64.2, down from 70.8.
Americans' long-term outlook was even more gloomy, with many anticipating a higher unemployment rate and lower after-tax income in the year ahead, Richard Curtin, the survey's director, said in a statement.
But more immediate plans for buying homes and vehicles were positive, Curtin said, while rising home and stock values were expected to support spending this year.
Economists have worried that higher payroll taxes and government belt-tightening could cause consumers to keep a closer watch on their wallets as the year goes on.
Consumer pessimism this month did suppress inflation expectations, with the one-year outlook dipping to 3 percent, the lowest in the past year, from 3.2 percent in March. The survey's five-to-10-year inflation outlook held at 2.8 percent.
The Federal Reserve has repeatedly pointed to tame inflation expectations and a still fragile labor market as reason to press ahead with its aggressive monetary stimulus.
(Reporting By Steven C. Johnson; Editing by Chizu Nomiyama)