Kraman Countdown panelists Kevin Mahn and Keith Fitz Gerald predict the future of interest rate cuts and discuss consumer stable stocks.
Consumer confidence continued to decline in March, with a new report showing one measure of short-term expectations from consumers at their lowest levels in 12 years.
The Conference Committee's expectations index, which measures the short-term outlook for consumer personal income and business and labor market conditions, fell 9.6 points to 65.2. This is the lowest level in 12 years, and is well below the 80 threshold, which is usually a recession.
The Consumer Trust Index fell 7.2 points in March to 92.9, below the 94 voted by the economists estimated by the LSEG. This is the lowest index reading since January 2021.
“For the fourth consecutive month in March, consumer confidence has declined, falling below the relatively narrow range that has been prioritized since 2022,” said Stephanie Guichard, senior economist for global indicators for the conference committee.
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Consumer trust fell in March due to more than expected economists. (Justin Sullivan/Getty Images)
“Of the five components of the index, only consumer ratings regarding current labor market conditions have improved, but slightly improved,” Guichard said. “The current view of business conditions has weakened to approach neutrality. Consumer expectations were particularly pessimistic. The pessimism about future business conditions has deepened and I was confident that the outlook for future employment would fall to its lowest level in 12 years.”
“On the other hand, consumer optimism about future income, which had been very strong in the past few months, suggests that the majority have disappeared and concerns about the economy and labour market have begun to spread to consumer evaluations of their personal situation,” she added.
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Consumers have expressed concern about inflation as well as tariffs leading to higher prices. (Sam Wolfe / Bloomberg Via / Getty Images)
The conference committee's report noted that the decline in trust was driven primarily by consumers for over 55 years, and that although not so much for some people aged 35 to 55, confidence has increased among consumers under the age of 35 to improve their assessment of the current situation.
Decreased confidence is widely seen across income groups, with the only exception being that households earn more than $125,000 a year.
Consumers' average 12-month inflation expectations rose again from 5.8% in February to 6.2% in March, with the conference committee saying “consumers continue to be concerned about major household staples like eggs and high prices that are affected by tariffs.”
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Consumers' plans to buy homes fell on a six-month moving average basis. (Allen J. Scheven / Los Angeles Times / Getty Images)
Plans for significant purchases such as homes and cars fell on a six-month moving average basis, while plans to purchase other high ticket items such as appliances and electronics increased.
The conference committee noted that respondents to the survey that provided the postal responses were considering Trump administration policies and expressed concerns about the impact of the trade war on prices.
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“Comments on the current administration and its policies were positive and negative, dominated consumer posts' responses on what affects the views of the economy. The responses of the posts also showed that inflation remains a major concern for consumers, with increasing concerns, particularly about the impact of tariffs.
