American consumer confidence fell sharply this month due to household concerns about higher inflation. The University of Michigan reports this in a preliminary estimate.
The confidence index fell to 67.4 from 77.2 in April, the lowest level in six months. The figure was also much lower than economists had expected.
According to the researchers, consumers expect inflation to be higher in the coming year than previously thought. High inflation undermines the purchasing power of households.
The Federal Reserve, the American Central Bank umbrella organization, may also wait longer before lowering interest rates if inflation is high.
These interest rate concerns also contribute to the decline in confidence, as does uncertainty about the job market in the United States. According to university researchers, these concerns exist across a broad spectrum of American society.