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Consumer Sentiment Rises, Yet Inflation Concerns Linger

1/24/2026

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Story summary
  • The University of Michigan's Consumer Sentiment Index rose to 56.4 in January from 54.0, indicating a modest improvement.
  • Inflation expectations for the next year fell to 4.0%, the lowest since January 2025.
  • Yet sentiment remains more than 20% lower than a year ago.
  • Tariffs continue to pressure businesses by raising costs and reducing purchasing power.
  • The Federal Reserve is expected to keep interest rates as inflation and labor markets persist.