STORY: U.S. consumer sentiment slipped to a three-month low in March as the war in the Middle East boosted oil prices and unleashed volatility on financial markets.
The University of Michigan's Surveys of Consumers said Friday that the final reading of its monthly sentiment survey dropped to its lowest level since December, reflecting consumers' concerns about the economy.
Oil prices have soared since the U.S. and Israel launched attacks against Iran and gasoline prices have jumped $1 to $3.98 per gallon, according to data from AAA.
Surging oil prices have sparked a stock market selloff, which economists warned would undermine consumer spending.
The survey also showed that consumer expectations for inflation over the next year jumped to 3.8% this month from 3.4% in February.
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Meanwhile, money market participants, who were pricing in two rate cuts from the Federal Reserve this year prior to the Middle East conflict, now aren't expecting any cuts, with traders now seeing a roughly 50/50 chance of a December rate hike, according to CME's FedWatch Group.
