Consumer confidence plummeted in February, indicating worry about the direction of the U.S. economy under President Donald Trump.
A gauge of consumer confidence registered its largest monthly drop since August 2021, the nonpartisan Conference Board said on Tuesday.
Meanwhile, the share of consumers who expect a recession within the next year surged to a nine-month high, the data showed. A growing portion of consumers believe the job market will worsen, the stock market will fall and interest rates will rise, the report added.
Trump has issued a flurry of economy-related directives since he took office last month, including tariff proposals, spending cuts and an assault on diversity, equity and inclusion initiatives.
Earlier this month, Trump announced 25% tariffs on goods from Mexico and Canada as well as 10% tariffs on products from China.
Trump paused the tariffs on Mexico and Canada for one month after striking a deal with each of the two countries on drug trafficking and border security. On Monday, Trump said he plans to go forward with the tariffs when that pause lifts next week.
Seven of every 10 American adults believe tariffs will raise prices, an Ipsos survey found last week.
Concern about rising prices coincides with a bout of resurgent inflation that stretches back to the final months of the Biden administration. Consumer prices rose 3% in January compared to a year ago, registering a percentage point higher than the Federal Reserve’s target of 2%.
Egg prices, a closely watched symbol of rising costs, soared 53% in January compared to a year ago. An avian flu has decimated the egg supply, lifting prices higher.
"Consumers who fear the impact of higher tariffs, spending cuts, and deportations are getting worried and are likely to be more cautious," Bill Adams, chief economist at Comerica Bank in Dallas, told ABC News.
Meanwhile, U.S. hiring slowed at the outset of the year. The nation added 143,000 jobs in January, far fewer than the 265,000 jobs gained a month prior, government data showed.
Still, some measures of consumer sentiment improved this month. Consumers’ assessment of current business conditions moved higher, while an uptick in purchasing plans for a home extended a monthslong recovery.
The fresh data follows a report last month from the University of Michigan showing that its gauge of consumer sentiment had declined for the first time in six months.
The results showed a sharp disparity between Democrats and Republicans, however. Attitudes among Democrats worsened while sentiment among Republicans improved.