the numbers the university of michigan’s gauge of consumer sentiment fell to a preliminary may reading of 577 from an april reading of 635 that is the lowest level since november last year economists polled by the wall street journal had expected a may reading of 63 americans view on nearterm inflation moderated slightly in may they now expect the inflation rate in the next year to average about 45 inflation expectations had surged to 46 in april from 36 in march inflation expectations over the next five years rose to 32 from 3 in april that’s the highest reading since 2011 key details a gauge that measures what consumers think about their financial situation and the current health of the economy fell to 645 from 682 in april another measure that asks about expectations for the next six months moved down to 534 in may from 605 in the prior month big picture consumer spending is the engine of the economy if households grow concerned about the outlook and pull back it could push the economy into recession and federal reserve officials won’t be pleased to see expectations of inflation over the longterm increase they view expectations as a key source of future inflation pressure what umich said “consumers’ worries about the economy escalated in may alongside the proliferation of negative news about the economy including the debt crisis standoff” the press release said market reaction stocks djia spx opened higher on friday while the yield on the 10year treasury note tmubmusd10y rose to 341