Consumer sentiment increased this month to its highest level since August, a sign that the economic unhappiness that has dragged down the political prospects of the Trump administration could be turning around.
Consumer sentiment rose to 57.3 in February, up from 56.4 in January, according to the preliminary reading of the University of Michigan Consumer Sentiment Index.
Despite the gains, consumer sentiment is still down 11.4% from a year ago and near historically low levels, showing the magnitude of the challenge facing President Donald Trump and Republicans as they try to retain control of Washington in the 2026 elections.
WARSHACH TEST: TRUMP’S FED CHAIRMAN PICK KEEPS MONETARY ANALYSTS GUESSING
In some more good news for the administration, inflation expectations continued to fall in February.
The closely watched consumer sentiment gauge has now risen for three consecutive months. This shows that sentiment is starting to move in the right direction, although it has been shockingly low, rivaling the depths seen in the aftermath of the global financial crisis and the worst of the bout of high inflation under former President Joe Biden.
“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,” survey director Joanne Hsu said.
Sentiment is still lower than when Trump entered office just over a year ago. Republicans will have to work hard to reassure voters that the economy is moving in the right direction ahead of this year’s midterm elections, where Democrats are hoping to seize on voter discontent with the economy.
Inflation and cost-of-living concerns are still weighing heavily on consumers, who have been grappling with the cumulative effects of years of too-high inflation that began spiking during the Biden administration’s pandemic recovery.
Year-ahead inflation expectations fell from 4% to 3.5% this month, the lowest since January 2025. The Federal Reserve’s target is for inflation to run at 2% over the long term. Meanwhile, long-run inflation expectations ticked up slightly to 3.3% in February, according to the survey.
Treasury Secretary Scott Bessent was asked about consumer sentiment this week when he appeared before the Senate Committee on Banking, Housing, and Urban Affairs to present the Financial Stability Oversight Council’s 2025 Annual Report.
Bessent was asked what more the Senate can do to help with consumer confidence.
BESSENT TAKES FLAK FROM DEMOCRATS OVER AFFORDABILITY IN SENATE HEARING
“Other than telling consumers to turn off MSNBC,” Bessent joked, before citing how these consumer confidence and consumer sentiment surveys are conducted.
“A large part of it is a survey problem where Democrats vote very low, Republicans are more realistic,” he added.
