The numbers: A survey of consumer sentiment rose slightly to 51.1 in July from an all-time low, but Americans were still deeply worried about high inflation and talk of a possible recession.
One bit of potentially good news: Americans expect high inflation to persist for a while but eventually subside. They see prices rising 2.8% over the next five years, down from 3.1% in June. That matches the lowest reading in 16 months.
The Federal Reserve cited the increase in inflation expectation in the June report as one of the reasons it raised a key U.S. interest rate last month by 0.75 percentage points.
Big picture: Americans are upset about the highest inflation in nearly 41 years . They are paying more for food, gas, rent and most other goods and services.
The Fed is raising interest rates aggressively to try to cool off the economy and tame the surge in prices, but the central bank risks triggering a recession if it raises rates too high, adding to the angst of consumers.
Key details: A gauge that measures what consumers think about their own financial situation and the current health of the economy rose to 57.1 from 53.8.
One worrisome part of the report: some consumers said they are buying certain things now to avoid paying higher prices in the future.
Yet another measure that asks about expectations for the next six months slipped to 47.3 from 47.5, signaling that Americans are worried about a deterioration in the economy toward the end of the year.
Looking ahead: “Confidence is still very, very, low, illustrating that surging inflation and the damage it is doing to their purchasing power is a big issue for households,” said chief U.S. economist Paul Ashworth of Capital Economics.