US consumer sentiment unexpectedly fell to the second-lowest level on record and inflation expectations climbed to multi-decade highs amid growing concerns about tariffs.

The University of Michigan's Consumer Sentiment Index fell again in May after economists expected a modest increase. Consumer sentiment is at its lowest level in nearly three years.

The preliminary reading of the University of Michigan’s closely watched consumer sentiment index, released Friday, declined 2.7% on a monthly basis to 50.8, the second-lowest level in the nearly 75-year history of the survey. The only lower reading was in June 2022. Since January, sentiment has tumbled nearly 30%.