Not surprisingly in light of the war’s impact on gas prices, the US consumer mood deteriorated meaningfully in March.

The final read on headline Michigan sentiment for this month was revised lower from the initial estimate to 53.3, down 6% from February and the worst readout of 2026.

As the figure below shows, the month-to-month drop was the largest since “Liberation Day,” which is to say Trump’s two most consequential actions thus far in his second term each led to outsized declines in household sentiment.

“Declines were seen across age and political party,” survey director Joanne Hsu said Friday. “Consumers with middle and higher incomes and stock wealth, buffeted by both escalating gas prices and volatile financial markets in the wake of the Iran conflict, exhibited particularly large drops in sentiment.”

I’ve mentioned that double-barreled risk repeatedly in March. The Iran war’s not just an issue for lower-income Americans at the gas pump. It’s also a problem for the upper-middle-class, where spending decisions are informed in part by the wealth effect.

At 55.8, the current conditions index remains near record lows, but it was the expectations gauge which posted the biggest drop in March’s Michigan survey. At 51.7, that index fell nearly 9%.

As the figure above reminds you, the forward-looking measure spent most of the last four years underwater versus its long run average.

Although longer-term inflation expectations actually slipped this month, the 12-month measure rose to 3.8%, up four tenths from February for the largest one-month increase since last year’s tariff chaos.

“At this time, consumers may not expect recent negative developments to persist far into the future,” Hsu remarked, summing things up. “[But] these views are subject to change,” she added.