Consumer Sentiment Falls as Iran War Worries Weigh

12:20 PM EDT, 03/13/2026 (MT Newswires) -- US consumer sentiment fell this month amid worries that higher energy prices could threaten personal finances as the war in the Middle East continued, a University of Michigan survey showed Friday.

The headline sentiment index dropped to 55.5 from 56.6 in February, according to preliminary results of the survey. The consensus was for the index to fall to 54.8 in a Bloomberg-compiled survey.

The US and Israel launched military strikes across Iran on the last day of February, aiming to destroy Tehran's nuclear capabilities. Iran's former Supreme Leader Ayatollah Ali Khamenei was killed in the attacks, and the country has been retaliating since then with missile and drone strikes across the Middle East.

"Interviews completed prior to the military action in Iran showed an improvement in sentiment from last month, but lower readings seen during the nine days thereafter completely erased those initial gains," Surveys of Consumers Director Joanne Hsu said in a statement.

Data for this survey were collected between Feb. 17 and March 9, with about half of the interviews completed after the Iran war broke out, Hsu said.

Crude oil prices have rallied as the Middle East conflict intensified, with the Strait of Hormuz -- the world's most important chokepoint for crude flows -- still effectively closed to shipments. The average price for a gallon of regular gasoline in the US jumped to $3.630 on Friday from $2.940 a month ago, according to AAA, a travel organization that tracks fuel prices in the country.

"Gasoline prices have exerted the most immediate impact felt by consumers, though the magnitude of passthrough to other prices remains highly uncertain," Hsu said. "A broad swath of consumers across incomes, age, and political affiliation all reported declines in expectations for their personal finances, down 7.5% nationally."

The overall expectations measure fell to 54.1 in March from 56.6 in February, below the 54.5 reading that analysts projected.

The gauge for current economic conditions rose to 57.8 in March, the highest in five months, from 56.6 in February, University of Michigan data showed. That's above the Street's view for 54.9.

Year-ahead inflation expectations held steady at 3.4% in March, after six consecutive months of declines. The five-year outlook ticked down to 3.2%.

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