Consumer sentiment fell sharply as Americans head into the traditional holiday shopping season.

The University of Michigan’s index of consumer sentiment fell five percent below the October reading, reversing about one-third of the gain since the historic low in June. The final November read for the index was 56.8, above the mid-month, preliminary reading of 54.7 but below the 64.7 reading in October.

The figure was better than expected. Economists had forecast a reading of 55 for November, closer to the midmonth reading.

“Along with the ongoing impact of inflation, consumer attitudes have also been weighed down by rising borrowing costs, declining asset values, and weakening labor market expectations. Buying conditions for durables, which had markedly improved last month, decreased most sharply in November, falling back 19 percent to its September level on the basis of high interest rates and continued high prices,” said Joanne Hsu, the director of the survey.

The gauge of current conditions dropped by 10.4 percent to 58.8 from the October level of 65.6. Compared with a year ago, the view of current conditions is down 20.1 percent.

The outlook saw a smaller decline, partly reflecting the fact that it was already very depressed. This dropped 1.1 percent to 55.6 percent.

Inflation expectations held steady, indicating that the drop in official inflation statistics for October did little to move the needle on where consumers forecast inflation over the medium and longer term. The median expected year-head inflation was 4.9 percent, down a tick from the five percent in the prior month. The long-run inflation expectation was three percent, up slightly from the 2.9 percent recorded a month earlier.

“Uncertainty over these expectations remained at an elevated level, indicating that the general stability of these expectations may not necessarily endure,” Hsu said.

The National Retail Federation this month forecast that holiday retail sales during November and December will grow between 6 percent and 8 percent over 2021 to between $942.6 billion and $960.4 billion. Last year holiday sales grew 13.5 percent over the previous year.