The new report on consumer sentiment came a day after the release of retail sales data that showed unexpectedly strong performance in June. Robust shopper appetites last month suggested that the uncertainty surrounding Trump’s tariffs hadn't prompted households to stash extra income.

New data showing price increases last month could foreshadow even higher costs if the president imposes steep tariffs on Aug. 1.

U.S. consumer sentiment improved in July, and while inflation expectations continued to decline, households still saw substantial risk of price pressures increasing in the future.