Consumer sentiment hits record low as inflation fears rise again

At Home Depot, a record-low 49.8 reading in consumer sentiment is likely to show up first as smaller carts, more price checks and more jobs postponed. The clearest signal for associates is not a sudden collapse in demand, but a customer who comes in ready to compare every option before spending on anything beyond the basics.

The University of Michigan’s final April reading slipped 3.5 points from March’s 53.3, matching the trough last seen in June 2022. The drop was broad-based, with declines across political party, income, age and education, and year-ahead inflation expectations rose to 4.7 percent from 3.8 percent in March. Long-run expectations climbed to 3.5 percent, the highest since October 2025.

The deterioration reflected fresh inflation fears tied to the Iran conflict and higher gasoline and diesel costs. The university said 98 percent of its April interviews were completed before the April 7 announcement of a temporary cease-fire, and said consumer views appeared to be driven primarily by shocks to gasoline and potentially other prices. For a retailer built around discretionary projects, that matters because buying conditions for durables and vehicles also worsened, a sign that households are getting more cautious about big purchases across the board.

For Home Depot, the backdrop adds another layer to a year already defined by careful spending. The company said fiscal 2025 sales reached $164.7 billion, comparable sales rose just 0.3 percent and U.S. comparable sales increased 0.5 percent. Chief executive Ted Decker said results reflected “ongoing consumer uncertainty and pressure in housing,” while underlying demand held up after adjusting for storms. The board also approved a 1.3 percent increase in the quarterly dividend to $2.33 per share.

On the floor, that kind of sentiment usually shows up in plain ways before it shows up in the numbers. Shoppers stretch out decisions on kitchen refreshes, bath remodels and other big-ticket projects. They spend more time looking for promotional tags, ask harder questions about cheaper substitutes and are more willing to split a project into stages instead of buying everything at once. That can mean steadier traffic in repair and maintenance aisles, but more hesitation around larger remodeling tickets, where associates often have to work harder to keep the sale alive.

The broad message for store teams is simple: the customer is still coming in, but with a sharper eye on price. In a year when housing pressure and inflation worries are still shaping behavior, Home Depot’s next test may be how well it helps shoppers do less, spend less and still leave feeling like they solved the problem.