(NewsNation) — Consumer confidence fell for the fifth straight month in April, sinking to its lowest level since the onset of the COVID-19 pandemic amid mounting concerns over President Trump’s tariffs.
The Conference Board’s Consumer Confidence Index tumbled 7.9 points in April to 86, its lowest reading since May 2020, according to Tuesday’s report.
“Unless the trade war cools off very (very) soon, recession appears dead-ahead,” said Mark Zandi, chief economist for Moody’s Analytics, commenting on the latest report on X.
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Consumers are feeling especially pessimistic about the future and nearly one-third expect hiring to slow in the coming months, almost matching the level in April 2009 during the Great Recession.
The Expectations Index, which gauges consumers’ short-term outlook for income, business and labor market conditions, has fallen to its lowest level since 2011 — well below the threshold that typically signals an impending recession.
“Expectations about future income prospects turned clearly negative for the first time in five years, suggesting that concerns about the economy have now spread to consumers worrying about their own personal situations,” Stephanie Guichard, senior economist at The Conference Board, said in the report.
The share of consumers anticipating a recession over the next 12 months rose to a two-year high in April.
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Fears around Trump’s trade war are driving the negativity, with mentions of tariffs reaching an all-time high in the latest survey.
“Consumers explicitly mentioned concerns about tariffs increasing prices and having negative impacts on the economy,” the Conference Board said.
While outlooks for the future have soured, Americans remain relatively confident about their current situation, helping prevent an even steeper drop in the Consumer Confidence Index.
Economists pay attention to consumer confidence since shifts in sentiment can influence spending behavior. In the U.S., consumer spending accounts for roughly two-thirds of overall economic activity.
Retail sales rose 1.4% in March, outpacing expectations, as shoppers stocked up in anticipation of tariff-related price hikes.
Other data suggests consumers are beginning to pull back. Sales of previously occupied U.S. homes plunged 5.9% in March from the prior month, the largest monthly decline since November 2022. It marked the slowest March sales pace since 2009.
The share of Americans planning an overseas vacation in the next six months fell to 16.4% in the Conference Board’s latest survey, down from 24.1% in December.
All age groups and most income groups reported lower confidence in April, but the decline was sharpest among consumers aged 35 to 55 and those in households earning over $125,000 a year.
The decline in confidence was shared across all political affiliations, the report said.
The Associated Press contributed to this report.
