WASHINGTON, May 22 (Xinhua) -- U.S. consumer sentiment dropped for the third straight month in May as supply disruptions in the Strait of Hormuz continue to boost gasoline prices, according to the University of Michigan Surveys of Consumers released on Friday.
Sentiment is now just below the previous historical low seen in June 2022. The cost of living remains the primary concern, with 57 percent of consumers reporting that high prices are eroding their personal finances, up from 50 percent in April, the surveys found.
Lower-income consumers and those without college degrees posted particularly strong declines in sentiment, as they are more sensitive to increases in the cost of gas and other essentials, according to the surveys.
The Surveys of Consumers is a rotating panel survey at the University of Michigan Institute for Social Research. It is based on a nationally representative sample that gives each household in the coterminous U.S. an equal probability of being selected. Interviews are conducted throughout the month via the web.
During interviews this month, nearly 40 percent of consumers offered unsolicited comments about gas prices, up from 33 percent last month, reflecting their importance in how consumers view the economy.
"As long as the Iran war continues, and oil stays near 100 (U.S. dollars a barrel) along with shortages in other commodities like fertilizer and plastics, I expect consumer sentiment to get weaker," said Gary Hufbauer, a nonresident senior fellow at the Peterson Institute for International Economics.
Dean Baker, co-founder of the Center for Economic and Policy Research, echoes this sentiment. "If the war ends soon, and the Strait is reopened, sentiment will turn up. If not, it will keep getting worse," he said.
According to the surveys, year-ahead inflation expectations inched up from 4.7 percent last month to 4.8 percent in May. Consumers appear worried that inflation will increase and proliferate beyond fuel prices, even in the long run.
The current reading substantially exceeds the 3.4 percent reading seen in February 2026, before the start of the Iran conflict, along with all 2024 readings.
Long-run inflation expectations climbed from 3.5 percent in April to 3.9 percent in May, notably higher than the 2.8 percent to 3.2 percent range seen in 2024.
This month's increase in long-run expectations reflects sizable jumps among independents and Republicans. For Republicans, long-run inflation expectations are currently more than double their February 2025 reading on a monthly basis.
Experts believe low consumer sentiment could cause trouble for the Republicans in November's midterm elections. "It is hard for many people to make a living and this is very harmful to Republican prospects in November," said Brookings Institution Senior Fellow Darrell West. ■