After months of gloom, consumer sentiment is rising for the first time in three months—a tentative sign that Americans’ mood about the economy may finally be turning a corner following wartime price spikes that drove it to historic lows.

The University of Michigan’s latest survey, released Friday, showed sentiment climbed 9% to a preliminary reading of 48.9 early this month. It marked the first increase since February, before the war between the U.S., Israel and Iran sent global energy prices soaring.

The Power of Gas Prices

The recovery comes down largely to one factor: what people pay at the pump.

Gas prices, which heavily shape how Americans perceive the economy, spiked in the weeks after the war began—pushing sentiment to a record low not once, but twice. As those prices have eased in recent weeks, sentiment has started to bounce back.

“This month, consumer sentiment ticked up… with consumers experiencing some relief due to the early-month easing in gasoline prices,” said Joanne Hsu, the survey’s director. She noted that lower-income consumers showed a particularly strong improvement, which makes sense given that gasoline eats up a larger share of their budgets.

A Historic Low to Climb Out Of

To appreciate the rebound, it helps to grasp just how far sentiment had fallen. Before this uptick, it sat lower than anything recorded during foreign wars, 9/11, the Great Recession, the pandemic, or any previous bout of high inflation in the post-World War II era.

Still, the gains may prove fragile. Sentiment is likely to remain depressed unless gas prices keep falling meaningfully—a shift that would probably require oil tankers to flow freely once again through the Strait of Hormuz, the critical chokepoint through which one-fifth of the world’s oil passes.

Why Sentiment Has Been Stuck So Low

The years-long slump has many causes, but it boils down primarily to the compounding price shocks of recent years steadily eroding affordability. The trouble is that there simply hasn’t been a long enough stretch of stability for Americans to recover.

Since 2020, the country has weathered one historic blow after another:

• The pandemic recession knocked sentiment down after the longest economic expansion on record at the time
• Post-pandemic inflation drove it to a record low in June 2022
• In 2023, continued Federal Reserve rate hikes and a debt-ceiling standoff in Congress weighed it down again
• A steady recovery in 2024 was undone in 2025, when President Trump’s sweeping tariffs renewed consumer anxiety

The Iran war is now the latest shock in that long sequence, largely through its effect on gas prices. For sentiment to climb durably above historic lows, experts say it would take a sustained period of economic stability paired with low inflation.

Are Consumers Getting “Numb to It”?

There’s another, more nuanced possibility: Americans may simply be adapting to constant volatility.

A separate quarterly survey from TransUnion, released earlier this week, found that consumer optimism hadn’t shifted much from a year ago, when Trump announced his “Liberation Day” tariffs last April. But notably, the level of pessimism dropped, according to Charlie Wise, TransUnion’s head of global research and consulting.

“We see a lot of resilience in consumers that maybe have gotten a little bit more accustomed to the volatile times that we live in, and a lot of price uncertainty,” Wise said in an interview.

Inflation remained consumers’ top financial concern in the second quarter, climbing to 50% from 47%, according to the credit bureau’s latest Consumer Pulse Survey. Yet Wise sees something more than mere fatigue at work.

“A cynic might say they’re getting numb to it, but I think more realistically they’re getting used to the realities that price stability is going to be a little out of normal balance for a continuing amount of time,” he explained.

That hard-won experience, he suggested, may be reshaping how people react to new shocks. Faced with rising gas and energy prices today, many consumers may now think: “I lived through this fairly recently and managed to come out OK on the other side; I’ll probably be OK this time too.”

The Road Ahead

For now, the modest rebound offers a glimmer of relief after a brutal stretch—but it rests on shaky ground. Whether sentiment continues to recover hinges largely on energy prices, which in turn depend on the fragile situation in the Middle East and the free movement of oil through the Strait of Hormuz.

If prices keep falling and the economy finds some stability, Americans’ battered confidence could slowly heal. If not, this uptick may prove to be just a brief pause in a long and difficult slump.