The decline accelerated sharply in
March and April as tariff fears intensified. By April, the index had
plunged to 86.0 — levels not seen since the onset of the COVID pandemic —
with the Expectations Index cratering to 54.4, its lowest since October
2011. Nearly a third of consumers expected fewer jobs ahead,
approaching levels last seen during the Great Recession, and
expectations for future income turned negative for the first time in
five years. The decline cut across all age groups, income brackets, and
political affiliations.
May
brought a notable 12.3-point rebound to 98.0 — the largest monthly gain
in four years — fueled by the May 12 U.S.-China tariff pause. The
improvement was broad-based, though the Expectations Index remained
below 80, the threshold historically associated with recession risk.
That
recovery proved short-lived. Confidence resumed declining from the
summer onward, falling for five straight months through December. By
year-end, the index stood at 89.1, with the Present Situation Index
dropping sharply to 116.8 as views on business conditions turned
negative for the first time since September 2024. The Expectations Index
held at a weak 70.7, marking 11 consecutive months below the
recession-warning threshold of 80
