Consumer sentiment in the United States has declined sharply, with concerns over a potential recession intensifying. According to the University of Michigan's latest survey, sentiment dropped 11% in April 2025 to a preliminary reading of 50.8—the second-lowest figure recorded since the survey began in 1952.
The downturn has been largely attributed to ongoing trade war tensions and growing fears of inflation. This follows similar findings from The Conference Board last month, which reported a 12-year low in its consumer expectations index and a notable dip in consumer confidence.
Joanne Hsu, director of the University of Michigan's survey, stated that the fall in sentiment reflects 'growing worries about the trade war developments that have oscillated over the course of the year.' She added that the decline was "pervasive and unanimous" across all demographics, including age, income, education, region, and political affiliation.
Consumers indicated worsening expectations across key indicators such as business conditions, personal finances, income, inflation, and the labour market. Notably, the percentage of respondents expecting rising unemployment has doubled since November, reaching its highest level since 2009.
'This lack of labour market confidence lies in sharp contrast to the past several years, when robust spending was supported primarily by strong labour markets and incomes,' Hsu said.
The report, which surveyed consumers between 25 March and 8 April, does not include any potential shift in sentiment following President Trump's recent decision to delay tariffs.
Expectations for year-ahead inflation rose significantly from 5% in March to 6.7% in April, the highest rate since 1981. The increase in inflation concerns was evident across all political affiliations.
Source: www.designerstoday.com