Tariffs Spark Fears: Consumer Confidence Plummets to 5-Year Low

( The Hill The Conference Board reported that their consumer confidence index fell by 7.9 points in April, representing its lowest point since May 2020, primarily due to President Trump’s trade tariffs.

Trump has imposed a baseline 10 percent tariff on most international partners and a 145 percent tariff on China, the world’s second-largest economy. Steep “retaliatory tariffs” on most of America’s other trading partners are on hold.

According to the board, a decline in consumer confidence occurred among people from all political backgrounds. The most significant drops were observed in consumers aged 35 to 55, as well as those in households with an annual income exceeding $125,000.

"Consumer confidence dropped for five months in a row in April, sinking to its lowest point since the start of the COVID-19 pandemic," stated Stephanie Guichard, a senior economist at The Conference Board.

"The decrease was primarily fueled by consumer expectations. Each of the three key areas—business climate, job opportunities, and anticipated earnings—deteriorated significantly, indicating widespread negativity towards the future," she noted.

According to the board, consumers specifically expressed worries that tariffs would lead to higher prices and have adverse effects on the economy. The majority of those surveyed reported grievances regarding the escalating cost of living due to inflation.

Approximately one out of every three respondents indicated that they anticipated business circumstances to deteriorate, whereas about 15.7% of the participants believed that business conditions would get better.

"Notably, the percentage of consumers anticipating a decrease in job availability over the coming six months (32.1%) was almost as high as it was in April 2009, during the heart of the Great Recession," stated Guichard.

“Furthermore, for the first time in half a decade, expectations regarding potential future earnings significantly diminished, indicating that economic worries have started affecting individuals' perceptions of their personal financial futures,” she noted. “Nevertheless, people’s current assessments remain relatively stable, which helps mitigate the overall drop in the Index.”

The short-term forecasts for income, business, and employment conditions have declined to 54.4, marking their lowest point since October 2011. This figure significantly dips beneath the typical warning line of 80, which often indicates an impending economic downturn, according to the board.

The monthly Consumer Confidence Survey relies on an online sample that represents millions of consumers. The initial findings were finalized by April 21st.

Updated at 11:42 A.M. E.D.T.

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