Despite stable job numbers, Americans are feeling increasingly pessimistic about the economy. Is there fire behind this smoke, or is it just smoldering old news?
Here are Five Fast Facts on the latest consumer confidence report:
- 📉 Sentiment Slumps - The University of Michigan's consumer sentiment index dropped to 50.8 in May 2025, nearing the record low of 50.0 from June 2022. That’s a lot of bad economic attitude!
- 😥 Tariff Troubles - Nearly 75% of consumers mentioned tariffs as a concern, up from 60% in April. Related question: can 75% of consumers even define what a tariff is? (We know you can, since you’re a reader here! 😉)
- 📈 Inflation Expectations Rise - Consumers anticipate a 7.3% increase in prices over the next year, the highest since 1981.
- 🫏🐘 🇺🇸🙂Partisan Perspectives - Democrats' sentiment hit a record low of 33.9, while Republican sentiment declined to 84.2. It’s pretty typical for the party in the White House to think of puppy dogs and rainbows, while the other one is setting itself on fire in angst, so this is no surprise!
- 👀 Economic Disconnect? - Despite positive trade developments, consumer concerns about inflation and tariffs persist. To paraphrase our friends in Missouri…people want the economy to show itself being good to go!
🔥Bottom line: The big question mark is how the tariffs affected this survey. The hard data still shows things humming along fairly well, and the announcement of the China deal – dropping tariffs on China from 145% down to 30% while they hammer out a long term deal – happened on the next to last day of the survey, so most of the responses still thought the 145% tariff train was heading straight at them. So is this data hitting the mark, or is it overstating the concern? We’ll find out next month!
How do you feel about the economy?
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