Preliminary University of Michigan consumer sentiment rose about 6% but remains roughly 10% below February levels; survey conducted Oct. 20–Nov. 2. Gains concentrated among independents; confidence improved for low- and middle-wealth households, while high-wealth households—those with large equity holdings—saw confidence fall about 5% after recent stock volatility. Respondents increasingly cite AI bubble concerns, but cost of living is the dominant issue: 57% said high prices have eroded their l

Preliminary University of Michigan consumer sentiment rose about 6% but remains roughly 10% below February levels; survey conducted Oct. 20–Nov. 2. Gains concentrated among independents; confidence improved for low- and middle-wealth households, while high-wealth households—those with large equity holdings—saw confidence fall about 5% after recent stock volatility. Respondents increasingly cite AI bubble concerns, but cost of living is the dominant issue: 57% said high prices have eroded their living standards, the highest since May and up from 46% before the Iran conflict in February. One-year inf expectations fell to 4.3% from 4.7% last month—lowest since August but well above February’s 3.4% and higher than any 2024 reading. Long-run inf expectations edged down to 3.4% from 3.5%, remaining above the Feb. 2.8–3.2% range. Ahead of the midterms, over two-thirds expect Democrats to win House control and a majority expect Democrats to win the Senate.