WASHINGTON, DC – According to a survey released by the University of Michigan on Friday, consumer sentiment in the United States plummeted to a new decade low in early February amid fears about rising prices.

The preliminary consumer sentiment index fell to 61.7 in the first half of February from a final reading of 67.2 in January, the lowest level since October 2011.  "Weakening personal financial prospects, mostly due to rising prices, reduced confidence in the government's economic policies, and the least favourable long-term economic forecast in a decade," said Richard Curtin, the survey's Chief Economist, in a statement.

"One-third of all consumers spontaneously noted the impact of increased inflation on personal finances, with nearly half of all consumers predicting decreases in their inflation adjusted incomes in the coming year," Curtin added.

The drop in consumer sentiment comes as the US Labor Department reported on Thursday that consumer prices rose at the quickest annual rate in nearly 40 years in January, heightening the probability of the Federal Reserve tightening monetary policy.

As it departs the ultra-loose monetary policy implemented at the outset of the Covid-19 pandemic, the Fed hinted in January that it is ready to launch a series of interest-rate hikes in March to confront growing inflation.

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