Gloomy but Spending: Why Sentiment and Sales Disagree in 2026

One of the most reliable patterns in economics is that people say they feel worse than they behave. In 2026 that gap is wider than usual, and understanding it helps you read both kinds of numbers.

• The University of Michigan sentiment index was 48.1 in the final September reading, below the 1st percentile of the series’ history ^[1].
• Retail and food services sales were up 6.0 percent year over year in August ^[2].
• The CNBC/NRF Retail Monitor showed core retail sales up 3.47 percent year over year in August, the 11th straight month of growth ^[3].
• The gap shows that stated mood is a poor predictor of near-term spending.

The mood

The final September reading of the University of Michigan consumer sentiment index was 48.1, a 7 percent fall from August; the current-conditions index was 50.9 and the expectations index 46.3. Sentiment was 12.7 percent below a year earlier and below the 1st percentile of the series’ history, meaning only a sliver of readings in the series have been lower ^[1].

The behavior

Spending tells a different story. Census data show retail and food services sales of $773.9 billion in August, up 6.0 percent from a year earlier ^[2]. The CNBC/NRF Retail Monitor, which uses anonymized card data, found core retail sales up 3.47 percent year over year in August and up for an 11th straight month, with NRF’s Matthew Shay noting that households were “budget-conscious but took full advantage of back-to-school promotions” ^[3].

Why people can feel bad and still spend

• Jobs: unemployment is 4.2 percent, low by historical standards ^[4].
• Wages: average hourly earnings are up 3.0 percent from a year ago ^[4], still positive even if prices are rising faster.
• Habit and necessity: a family cannot stop buying groceries or fuel because it is worried.
• Selectivity: shoppers trade down and hunt promotions rather than stopping purchases.

A closer look at the NRF numbers

The CNBC/NRF Retail Monitor gives a gentler view than the Census series. In August total retail sales rose 0.22 percent from July and 3.87 percent from a year earlier, and core sales, which exclude autos, gas and restaurants, rose 0.17 percent on the month and 3.47 percent on the year, all seasonally adjusted ^[3]. July had been stronger: total sales up 0.32 percent on the month and 5.15 percent on the year, and core up 0.30 percent and 4.72 percent ^[3].

NRF’s president, Matthew Shay, said that supported by low unemployment and steady wage gains, households remained “budget-conscious but took full advantage of back-to-school promotions” ^[3]. That is the same split as in the survey data: people say they are worried and still buy, but they shop for deals. The monitor’s detailed category breakdown was due with the full report in October, so this article does not claim any sector figures ^[3].

What to do with the gap

Treat sentiment as a weather forecast for the future, not a measure of today. It tends to matter when it translates into job losses or tighter credit. The risk in 2026 is that a long period of dismal mood plus higher interest rates eventually shows up in spending. So far it has not. This is analysis, not investment advice.

Questions readers ask

What is consumer sentiment at?

The University of Michigan’s final September 2026 reading was 48.1, below the first percentile of its history ^[1].

Are consumers still spending?

Yes: retail and food services sales were up 6.0 percent year over year in August, and the CNBC/NRF monitor showed an 11th consecutive monthly gain ^[2][3].