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2mo ago

Consumer Confidence Hits Four-Year Low as Economic Worries Grow

Pessimism about inflation, tariffs, and future employment drives sharp decline in confidence indices, raising concerns of a potential recession.

FILE - Shoppers make their ways down an aisle lined with clothing and shoes in a Costco warehouse Thursday, Jan. 23, 2025, in Sheridan, Colo. (AP Photo/David Zalubowski, File)
Customers shop for produce at an H-E-B grocery store on February 12 in Austin, Texas.
Shipping containers at the Port of Los Angeles in Los Angeles on February 20. The busiest trade hub in the US moved more containers last month than in any previous January, as importers rushed to bring in goods before widely anticipated tariff hikes from President Donald Trump.

Overview

  • The Conference Board's consumer confidence index fell to 98.3 in February, marking its largest monthly drop since August 2021 and well below economists' expectations.
  • Short-term expectations for income, business conditions, and the job market dropped significantly, with the index falling to 72.9, a level often associated with recession risks.
  • Inflation concerns persist as January saw inflation tick up to 3%, while retail sales fell sharply by 0.9% after a strong holiday season, signaling potential economic slowdown.
  • Mentions of trade and tariffs surged in consumer surveys, reflecting fears over President Trump's proposed tariffs, which economists warn could further push inflation upward.
  • Despite low unemployment and steady growth, consumer pessimism about future economic conditions has reached a ten-month high, with recession expectations climbing to their highest level in nine months.