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Consumer Confidence Falls to Pre-Covid Levels

[ May 1, 2025   //   ]

U.S. consumer confidence slumped for a fifth-month to a 13-year low, a level not seen since the onset of the Covid-19 pandemic, as anxiety over the impact of tariffs takes a heavy toll, the Associated Press reported.

The non-partisan think tank Conference Board said April 29 that its consumer confidence index fell 7.9 points to 86. Nearly one-third of consumers expect hiring to slow in the coming months, nearly matching the level reached in April 2009, when the economy was mired in the Great Recession.

U.S. consumers are at a rapidly souring mood, most of whom expect prices to rise because of the widespread tariffs imposed by President Donald Trump. About half of Americans are also worried about the potential for a recession, according to a survey by The Associated Press-NORC Center.

Meanwhile, the Labor Department’s latest report on hiring and the unemployment rate, expected Monday, should still show steady job gains, though some forecast it could report sharply reduced hiring, the AP said.

The stark decline in consumer confidence also likely reflected the sharp swings in stock and bond prices that roiled financial markets earlier this month. While all age groups and most income brackets reported lower confidence, the decline was steepest among households earning more than US$125,000 and among consumers 35 to 55 years old.

The Conference Board said that mentions of tariffs in write-in responses reached an all-time high this month, with the duties on the top of consumers’ minds. Trump has imposed a tariff of 10 percent on nearly all imports, as well as a huge 145 percent tariff on most goods from China. He has imposed separate import taxes on steel, aluminum, and cars.

U.S. consumers are also worried that the economy could tip into a recession, with the proportion of consumers expecting a downturn in the next 12 months reaching a two-year high.

Fewer consumers said they were planning to buy a home or car in the next six months. Sales of previously occupied U.S. homes slowed last month in a lackluster start to the spring homebuying season as elevated mortgage rates and rising prices discouraged those looking.

And Americans also said they would spend less on services. The proportion of Americans planning an overseas vacation in the next six months fell to 16.4 percent, down from 24.1 percent in December. And the proportion of consumers planning to spend more on dining out plummeted by nearly the most on record in April, the Conference Board said.

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