Consumer sentiment continued to fall in February as worries over inflation and the possibility of higher prices to come from President Donald Trump ’s tariffs policy appeared to drive the University of Michigan’s monthly sentiment index down.

Respondents expect the inflation rate a year from now to be 4.3%, a 1-point jump from January and the highest level since November 2023.

U.S. consumer sentiment dropped unexpectedly in February to a seven-month low and inflation expectations rocketed as households feared it may be too late to avoid the negative effects on their purchasing power from President Donald Trump's threatened tariffs.

Traders across the globe project that tariffs and inflation will have the biggest impact on global markets in 2025 as they brace for volatility, an annual survey of institutional trading clients by JPMorgan Chase showed on Wednesday.

U.S. stock markets hit following President Trump’s announcement of new tariffs on key trading partners, with many tariff-sensitive stocks seeing increased volatility. Some traders have built “baskets” of tariff-sensitive stocks,