By David Harrison 

Consumers' outlook for the U.S. economy fell sharply in early January, reflecting American households' fears over the government shutdown, trade tensions, volatile markets, a cooling global economy and uncertainty over what the Federal Reserve will do next.

The University of Michigan said Friday its consumer-sentiment index was 90.7 this month, down from 98.3 in December. January's preliminary reading was the lowest since President Trump was elected.

The reading was well below the forecast of economists surveyed by The Wall Street Journal, who had expected an index of 96.4 in January.

While the reading does not suggest a recession is imminent, it is a sign that consumers could pull back on discretionary spending, said Richard Curtin, the survey's chief economist.

Write to David Harrison at david.harrison@wsj.com

(END) Dow Jones Newswires

January 18, 2019 10:44 ET (15:44 GMT)