At 2.7%, Americans’ year-ahead inflation expectations slipped to the lowest since December of 2020 early this month.

That’s according to the preliminary read on University of Michigan sentiment for September, released Friday.

The report was the last notable macro update of the week for the world’s largest economy. The subdued read on the near-term inflation outlook was welcome news for a Fed which, according to media reports, is still torn on the size of next week’s rate cut.

Inflation expectations at the five-year point were 3.1%. They’ve meandered in a range for years.

The relatively benign view on prices helped bolster overall sentiment, which rose to 69, slightly ahead of estimates. Consensus wanted 68.5. The Michigan headline now sits at a four-month high.

As ever, you’re reminded that consumer moods still haven’t recovered from the twin shocks of the worst public health crisis in a century and the worst bout of inflation in a generation.

As the figure shows, there’s a very long way to go before the “vibecession” ends. If an actual recession comes along at some point in the next six or so months, the bad macro vibes may just stick with America in perpetuity.

Weighing in Friday with some perfunctory color, survey director Joanne Hsu said consumers were less concerned about high prices and incrementally more worried about the labor market this month.

Expectations for lower interest rates were the highest since 1980.