U.S. consumer confidence has fallen to an eight-month low amid pressure from high prices

U.S. consumer confidence unexpectedly fell to its lowest level in eight months in early July as high prices continued to weigh on Americans' views of their personal finances and the economy.

The University of Michigan's preliminary July consumer sentiment index fell to 66 from 68.2. The median estimate of economists surveyed by Bloomberg was for a slight rise to 68.5.

Data released Friday showed consumers expect inflation in the coming year to run at 2.9 percent, the second straight monthly decline, Bloomberg reported. Respondents also expected annual inflation of 2.9 percent over the next five to 10 years, down from the previous month.

The University of Michigan also released a special report on inflation expectations, a recent concern among economists. The report found that the difference between mean and median long-term inflation expectations was caused by a small number of consumers and was "unlikely to reflect a fundamental deterioration in consumer inflation expectations."

Data this week showed inflation broadly cooled in June, with core consumer prices rising at their smallest pace since 2021, strengthening the case for the Federal Reserve to cut interest rates in the coming months.

"Despite expectations of a moderation in inflation, consumers remain strongly dissatisfied with high prices, with nearly half saying that high prices are reducing their standard of living," Joanne Hsu, who led the survey, said in a statement.

The November presidential election could weigh on consumers' expectations for the economy, the report said.