CNN: It’s been a little while since Americans had an inkling of optimism about the economy.
Consumer confidence rose 12.3 points this month to a reading of 98, the Conference Board said in its latest survey released Tuesday, the first monthly gain since November and the biggest monthly increase since March 2021. That’s higher than economists’ expectations for a reading of 88, according to data firm FactSet.
For the past several months, President Donald Trump’s sweeping policy changes, including his ongoing trade war, have taken a toll on people’s attitudes toward the economy. Last month, consumer confidence fell to its lowest level since the early days of the Covid pandemic.
But progress in Trump’s negotiations with other countries over trade gave Americans a sense of hope this month.
“The rebound was already visible before the May 12 US-China trade deal but gained momentum afterwards,” Stephanie Guichard, senior economist at the Conference Board, said in a release. “The monthly improvement was largely driven by consumer expectations as all three components of the Expectations Index — business conditions, employment prospects, and future income — rose from their April lows.”
Still, economic jitters persist and Trump still has more than a hundred trade deals to hash out by early July, when his reciprocal tariffs are slated to go back into effect, if countries haven’t negotiated a trade deal with the US. So, uncertainty is still very much elevated, which raises the question of what it means for consumer spending, which powers two-thirds of the US economy.
“Consumer confidence may have soared, and Americans have reason to be happy given the rollback in tariffs, especially with China,” said Robert Frick, corporate economist at Navy Federal Credit Union, in commentary issued Tuesday. “But when prices start rising from existing tariffs in a month or two, it will be a sobering reminder that a new inflation fight has just begun.”
Consumer Confidence Improves for the First Time Since November
