U.S. Economy Faces Diverging Sentiments as Consumers Worry and CEOs Express Optimism

Consumer confidence plunges to its lowest in over a year, while CEOs remain upbeat about deregulation and potential tax cuts.

The University of Michigan's consumer sentiment index dropped to 64.7 in February, its lowest level since November 2023, driven by inflation fears and new tariff concerns.
Households' one-year inflation expectations surged to 4.3%, well above the Federal Reserve's 2% target, marking a sharp increase from January's 3.3%.
Major U.S. stock indexes, including the Dow and S&P 500, experienced their worst losses of the year on Friday, reflecting investor concerns over economic uncertainty and softening consumer demand.
In contrast to consumer sentiment, a Conference Board survey found that CEO confidence has risen, fueled by expectations of deregulation and corporate tax cuts under the Trump administration.
The introduction of new tariffs on imports, including lumber, steel, and aluminum, has heightened economic uncertainty, with economists warning of potential inflationary pressures.