Consumer Confidence Drops to 4-Year Lows, Inflation Expectations Rise
The Conference Board Consumer Confidence Index fell to 92.9 in March, down from 100.1 the previous month and below the anticipated 94.0. A deeper look reveals concerning trends: the expectations measure for the next six months plunged nearly 10 points to 65.2—the lowest in 12 years and well below the 80 mark typically signaling an impending recession—while the assessment of current conditions saw a more moderate decline.
That marks the fourth straight month of declines, “falling below the relatively narrow range that had prevailed since 2022,” said Stephanie Guichard, senior economist, Global Indicators at The Conference Board.
“Of the Index’s five components, only consumers’ assessment of present labor market conditions improved, albeit slightly. Views of current business conditions weakened to close to neutral. Consumers’ expectations were especially gloomy, with pessimism about future business conditions deepening and confidence about future employment prospects falling to a 12-year low,” Guichard added.
Approximately 33.6% of consumers reported that jobs were “plentiful,” consistent with the previous month, while 15.7% noted jobs were “hard to get,” a slight decrease from 16.0%. The Present Situation Index edged down to 134.5 from 136.5 in February.
Possibly reacting to recent market fluctuations, consumers expressed pessimism about the stock market for the first time since late 2023.
In March, just 37.4% of consumers anticipated a rise in stock prices over the next year—a drop of nearly 10 percentage points from February and 20 percentage points from the peak in November 2024. Conversely, 44.5% foresaw a decline in stock prices, an increase of 11 percentage points from February and more than 22 percentage points higher than in November 2024.
At the same time, average 12-month inflation expectations climbed to 6.2% in March from 5.8% in February, driven by persistent consumer worries over elevated prices for essential household items like eggs and the effects of tariffs—though this uptick was notably milder than the sharper swings seen in the University of Michigan’s data.