Consumer expectations plunge to their lowest level in 12 years as recession signal blares
A measure of consumers’ short-term expectations has fallen to its lowest level in 12 years, ticking a figure that has historically signaled recessions ahead.
A measure of consumers’ short-term expectations has fallen to its lowest level in 12 years, ticking a figure that has historically signaled recessions ahead.
The measure of the short-term outlook for income, business and labor market conditions published by The Conference Board, a business membership group, fell 9.6 points from February to 65.2, the worst result since 2013 and well below the threshold of 80 that has historically augured negative growth for the economy.
"Consumers’ expectations were especially gloomy, with pessimism about future business conditions deepening and confidence about future employment prospects falling to a 12-year low,” Stephanie Guichard, senior economist of global indicators at The Conference Board, said in a release. “Meanwhile, 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.”
The board said overall consumer confidence had declined for a fourth consecutive month in March and fell below the relatively narrow range that had prevailed since 2022. Stock market declines likely proved a significant role in the worsening outlook, it said; earlier this month, the S&P 500 entered correction territory — down 10% from its recent high — for the first time since 2022.
Measures of consumer confidence and expectations have been declining across the board in recent weeks amid growing uncertainty about the impact of President Donald Trump’s tariffs strategy and his attempts to downsize federal agencies.
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