By Christopher Lugerber, Economics writer for the Associated Press
WASHINGTON (AP) – American confidence has plummeted to its lowest level in the fifth month since the onset of the Koibed-19 pandemic, as anxiety over the impact of tariffs has hit consumers’ expectations of future growth.
The Conference Committee said Tuesday that the Consumer Trust Index fell 7.9 points to 86 points in April, the lowest reading since May 2020. Nearly a third of consumers expect employment to slow down in the coming months, roughly coinciding with the level in which the economy fell into the Great Recession in April 2009.
The numbers reflect a rapidly sour mood among Americans, most of which expect prices to rise due to the widespread tariffs imposed by President Donald Trump. A survey by the Apsociated Press-Norc Center shows that about half of Americans are also worried about the possibility of a recession.
The measure of short-term expectations for Americans’ income, business conditions and job markets plummeted 12.5 points to the lowest level of 54.4 points in over 13 years. Reading is well below 80, usually indicating the upcoming recession.
How this gloomy mood will lead to spending, employment and growth will become more clear in the coming days and weeks. On Wednesday, the government reported on US economic growth in the first three months of the year, with economists expecting it to show a sharp slowdown as consumers pulled back spending after the winter holiday shopping season.
And on Friday, the Labor Bureau will release its latest report on employment and unemployment rates. Overall, economists expect it should still show the benefits of a stable job, but some predict that it could indicate a significant reduction in employment decline.
The sudden decline in consumer confidence is also likely to reflect the sudden fluctuations in stock prices and bond prices that have shaken up the financial markets. Although all age groups and most income brackets reported low confidence, the decline was the most sharpest among households earning more than $125,000 and consumers aged 35 to 55.
Major US markets have recovered in the past week, but the S&P 500 still falls 6% per year, with the Dow Jones losing 5%. Nasdaq, which has been growing, fell 10% in 2025.
Original issue: April 29, 2025 10:41am EDT
