U.S. consumer confidence falls to 89.1 as recession fears persist despite 4.3% Q3 growth
U.S. consumer confidence fell 3.8 points in December to 89.1 from a revised 92.9 in November, with the expectations index stuck at 70.7—below the 80 recession-warning threshold for an 11th month—and the present situation index down 9.5 points to 116.8; survey write‑ins flagged prices, inflation, tariffs, immigration, war and personal‑finance concerns, and perceptions of the labor market weakened. That softening in sentiment contrasts with BEA data showing 4.3% annualized GDP growth in Q3 (the fastest in two years), while labor data—64,000 jobs added in November after a 105,000 loss in October, 4.6% unemployment and average monthly gains since March down to 35,000 from 71,000—underscore economists’ view of mixed signals from wages and spending.
📌 Key Facts
- The Conference Board consumer confidence index fell 3.8 points in December to 89.1 (from a revised 92.9 in November), roughly returning to April levels tied to the announcement of new Trump tariffs.
- The expectations index held at 70.7 in December—below the 80 'recession signal' threshold for an 11th straight month—while the present-situation index dropped 9.5 points to 116.8.
- Survey write‑in responses show prices, inflation and tariffs remain top concerns, with rising mentions of immigration, war and personal‑finance issues such as interest rates, taxes, banks and insurance.
- Perceptions of the labor market weakened (26.7% said jobs were 'plentiful', down from 28.2%; 20.8% said jobs were 'hard to get', up from 20.1%), and Labor Department data show volatile payrolls—+64,000 jobs in November, -105,000 in October—with unemployment at 4.6% and average monthly job growth since March slowed to 35,000 (from 71,000).
- BEA data show U.S. GDP grew at a 4.3% annualized rate in Q3 2025 (up from 3.8% in Q2), the fastest growth in two years, even as consumer confidence slipped.
- Economists cited an apparent disconnect between robust GDP growth and softening consumer sentiment, pointing to conflicting signals from wage and spending data.
📊 Relevant Data
Trump's tariffs have raised overall retail prices by about 4.9 percentage points relative to the pre-tariff trend.
Trump Tariffs Raising Prices for Consumers, New Evidence Shows — Tax Foundation
Tariffs disproportionately impact U.S. manufacturing industries, which employ mostly White, male, and noncitizen workers, leading to higher job losses in these demographics.
Tariff costs impact industries with mostly White, male, and noncitizen workers — Equitable Growth
Since the announcement of tariffs in April 2025, overall manufacturing employment has declined by 42,000 jobs, squeezing middle-class workers.
Trump's Trade War Squeezes Middle-Class Manufacturing Employment — American Progress
The breakeven rate of job growth has dropped significantly in recent years due to fewer immigrants and aging demographics, requiring fewer jobs to keep unemployment stable.
America's job market just got some troubling news — CNN Business
Trump's tariffs are projected to reduce long-run U.S. GDP by about 6% and wages by 5%, with a middle-income household facing a $22,000 lifetime loss.
The Economic Effects of President Trump's Tariffs — Penn Wharton Budget Model
📊 Analysis & Commentary (1)
"A commentary highlighting the gap between strong headline economic metrics (like Q3 GDP) and falling consumer confidence, arguing that distributional effects, policy decisions and narratives create a perceived 'vibecession' that requires targeted political and policy responses rather than reliance on aggregate data alone."
📰 Sources (2)
- Conference Board consumer confidence index fell 3.8 points in December to 89.1 from a revised 92.9 in November, near April levels when new Trump tariffs were announced.
- The expectations index held at 70.7 for December, remaining below the 80 recession signal mark for an 11th straight month, while the present situation index dropped 9.5 points to 116.8.
- Survey write‑in responses show prices, inflation and tariffs remain top concerns, with rising mentions of immigration, war, and personal‑finance issues such as interest rates, taxes, banks and insurance.
- Perceptions of the labor market weakened: 26.7% of respondents said jobs were 'plentiful' (down from 28.2%) and 20.8% said jobs were 'hard to get' (up from 20.1%).
- New BEA data show U.S. GDP grew at a 4.3% annualized rate in Q3 2025, up from 3.8% in Q2 and the fastest in two years, even as consumer confidence slipped.
- Economists cited in the piece note an apparent disconnect between robust GDP growth and softening consumer sentiment, pointing to conflicting signals from wage and spending data.
- Labor Department data are restated with context: the U.S. added 64,000 jobs in November but lost 105,000 in October, with unemployment at 4.6% and average monthly job growth since March down to 35,000 from 71,000.