The latest University of Michigan U.S. consumer sentiment survey revealed that consumers are overall feeling far less optimistic about the economy in March than one month prior.

The U of M’s index for consumer sentiment fell to 57.9 in March from 64.7 in February, reflecting an 11% decline month-to-month and to its lowest mark since November 2022. Additionally, March’s figure was down 27.1% year-over-year. Economists polled by Reuters forecasted a preliminary reading of 63.1 in March.

The Survey of Consumers director noted that March saw broad declines consistently across all groups by age, education, income, wealth, political affiliations and geographic regions. Sentiment has now fallen in three straight months and is down 22% from December.

University of Michigan Consumer Sentiment Index — Month-to-Month

source: tradingeconomics.com

The survey noted that consumers pointed to the significant uncertainty surrounding policy and other economic factors, noting that the frequent shifts in economic policies make it challenging to plan for the future.

According to the survey results, long-run inflation increased from 3.5% in February to 3.9% in March, marking the largest month-to-month rise seen since 1993 following an already large increase in February.

Conversely, the survey’s index for year-ahead expectations increased to 4.9% in March — the highest rating since November 2022 and marking three consecutive monthly increases of 0.5-percentage-points or more. The monthly reading was well above the range of 2.3% to 3.0% in the two years preceding the COVID-19 pandemic