Client confidence declined sharply in February as extra Individuals felt uneasy concerning the future state of the US financial system, according to new data released Tuesday morning.
The Convention Board’s Client Confidence Index for February got here in at a studying of 98.3, a major drop from January’s revised 105 studying and wanting the 102.5 studying anticipated by economists.
“In February, client confidence registered the most important month-to-month decline since August 2021,” mentioned Stephanie Guichard, senior economist of world indicators at The Convention Board. “That is the third consecutive month-on-month decline, bringing the Index to the underside of the vary that has prevailed since 2022.”
The “Current Scenario Index,” which measures shoppers’ evaluation of present enterprise and labor market situations, fell to 136.5 in February from 139 in January.
The “Expectations Index,” which tracks shoppers’ short-term outlook for revenue, enterprise, and labor market situations, additionally fell to 72.9 in February from 82 final month. Traditionally, a studying under 80 in that class alerts a recession within the coming 12 months. This was the primary time since June 2024 that the index got here in under that threshold.
In the meantime, common 12-month inflation expectations jumped from 5.2% final month to six% in February.
“This improve probably mirrored a mixture of elements, together with sticky inflation but additionally the current leap in costs of key family staples like eggs and the anticipated influence of tariffs,” Guichard mentioned. “References to inflation and costs basically proceed to rank excessive in write-in responses, however the focus shifted in the direction of different matters.”
“There was a pointy improve within the mentions of commerce and tariffs, again to a stage unseen since 2019. Most notably, feedback on the present Administration and its insurance policies dominated the responses.”
