US consumer confidence tumbles for the 4th consecutive month to a 12-year low

The proportion of consumers anticipating a recession in the next year held steady at a nine-month high, the board reported.

“Consumers’ optimism about future income — which had held up quite strongly in the past few months — largely vanished, suggesting worries about the economy and labor market have started to spread into consumers’ assessments of their personal situations,” said Stephanie Guichard, senior economist at The Conference Board.

While inflation has retreated from the highs during the post-pandemic rebound, it has remained above the Federal Reserve’s 2% target. Those still-elevated prices, combined with President Donald Trump’s announced tariffs on many imported goods, has Americans feeling sour about spending as concerns about the economy mount.

Consumers appeared increasingly confident heading into the end of 2024 and spent generously during the holiday season. However, U.S. retail sales dropped sharply in January, with cold weather taking some of the blame.

Earlier this month, the government reported that Americans modestly stepped up their spending in February after a sharp pullback the previous month.

The board reported Tuesday that consumers’ view of current conditions decreased 3.6 points to 134.5.

The consumer confidence index measures both Americans’ assessment of current economic conditions and their outlook for the next six months.

Consumer spending accounts for about two-thirds of U.S. economic activity and is closely watched by economists for signs about how the American consumer is feeling.

Credit: AP

Credit: AP

Credit: NYT

Credit: NYT