Michigan's consumer survey ends September at a four-month low as the inflation outlook holds at 4.6%
On Friday, September 25, 2026, the University of Michigan's final consumer survey put its main index at 48.1, with the one-year inflation outlook still at 4.6%.
Hours before the 10 a.m. Eastern release, traders were pricing a nearly 71% chance of an October rate hike, the CME FedWatch reading CNBC reported at 4:08 a.m. Eastern. The survey did not give them a lower one-year inflation number.
The expectations index, which includes a five-year view of business conditions, fell 5.2 points from August to 46.3, a much larger drop than in current conditions, which fell 1 point to 50.9. Joanne Hsu, who directs the University of Michigan's Surveys of Consumers, called the main index the lowest in four months. At 48.1, it is 3.6 points below August's 51.7 and still above May's 44.8.
She said views of current and year-ahead personal finances had weakened by about 10%, and that concern about high prices was climbing. The short-run business outlook plunged, she said, on worry that elevated fuel prices and renewed trade disputes could spread through the economy. The university called the one-year reading the highest since June, and said it "substantially exceeds the 3.4% seen in February before the Iran conflict began." In May the university tied its 44.8 reading to supply disruptions in the Strait of Hormuz that were lifting gasoline prices. Expected inflation over the next five to ten years was 3.4%, unchanged from September 11 and up from 3.3% in August.
Some consumers, Hsu said, saw buying long-lasting goods now as a way to avoid higher prices later. Buying conditions for those goods improved modestly.
The 4.6% figure was already public on September 11, before the Federal Reserve raised its target range by a quarter of a percentage point on September 16, to 3.75% to 4%, the first increase since July 2023. Final interviews ran through September 21, covering days before and after that increase. Governor Michael Barr said Wednesday that, in his base case, further policy adjustments are likely to be needed to ensure inflation comes down to target in a timely fashion. That is the question in front of the meeting on Tuesday, October 27, and Wednesday, October 28, with another reading from this survey due on Friday, October 9.
Frequently asked
How low did Michigan's consumer survey end September?
The final main index was 48.1, the lowest in four months, 3.6 points below August's 51.7 and still above May's 44.8.
Did the one-year inflation outlook come down?
It held at 4.6%, which the university called the highest since June and said substantially exceeds the 3.4% seen in February before the Iran conflict began.
Were traders expecting an October rate hike before the release?
Hours before the 10 a.m. Eastern release, traders were pricing a nearly 71% chance of an October rate hike, and the survey did not give them a lower one-year inflation number.
What weighed on the shorter-run business outlook?
Joanne Hsu said the short-run business outlook plunged on worry that elevated fuel prices and renewed trade disputes could spread through the economy.