Despite markets closing strong, the mood on Main Street is lukewarm at best. University of Michigan’s April consumer sentiment came in at 52.2—up from the initial 50.8 read but still the lowest since July 2022. The expectations index cratered to 47.3 as households braced for a fresh wave of inflation and economic instability.

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Tariff uncertainty was the elephant in the room: year-ahead inflation expectations surged to 6.5%, the highest since 1981. While current conditions didn’t deteriorate as much as feared, the trend is unmistakable—Americans are rattled. Long-run inflation expectations also ticked up to 4.4%, suggesting the damage may be structural. Markets may be climbing, but the consumer—the engine of U.S. growth—is flashing red.