American consumers are expressing growing unease about the economic future, with confidence levels declining notably from November to December, according to the Conference Board’s monthly survey. This downturn reflects widespread anxiety surrounding President-elect Trump’s proposed trade policies and their potential impact on consumer prices. The biggest shift in sentiment pertains to economic expectations, with fewer respondents anticipating improved conditions and a corresponding rise in those expecting a worsening economic climate. The Conference Board’s expectations index currently hovers precariously above recessionary levels.
President-elect Donald Trump speaks at AmericaFest, Sunday, Dec. 22, 2024, in Phoenix. (AP Photo/Rick Scuteri)
This decline follows a brief surge in optimism immediately after the election, attributed to expectations that a Trump presidency would bolster economic conditions. However, the resurgence proved short-lived, with the economic outlook now mirroring levels observed in July. Despite positive economic indicators such as lower inflation, Federal Reserve rate cuts, robust job growth, and a rising stock market, consumer sentiment remains subdued.
One contributing factor to this unease is the anticipated impact of Trump’s proposed tariffs on imported goods. A recent Conference Board survey revealed that a significant 46% of respondents expect Trump’s trade duties to elevate living costs. This concern is echoed in the University of Michigan’s sentiment survey, which recorded a substantial jump in the number of respondents anticipating price increases for major household purchases.
The complexities surrounding tariffs often lead to voter confusion, exacerbated by misconceptions about who bears the financial burden. While Trump asserts that foreign companies absorb these costs, the reality is that American importers often pass on the increased expenses to consumers. With Trump’s victory solidifying the likelihood of new tariffs, this awareness appears to be growing among voters. Media outlets are increasingly highlighting specific goods expected to experience price hikes, including food, clothing, electronics, and industrial machinery, prompting consumers to brace for potential financial strain.
Another underlying issue is the pervasive sense among some Americans that prosperity remains elusive, irrespective of positive economic data. This sentiment is particularly prevalent among non-college graduates struggling to find stable careers in the evolving tech-driven economy. This long-standing challenge transcends any specific presidential administration, highlighting a deeper structural issue within the American workforce.
Whether the current economic anxieties will dissipate under Trump’s leadership remains uncertain. The ultimate impact of his tariff policies, the trajectory of food and gasoline prices, and his overall leadership style will all play a crucial role in shaping consumer confidence. Ultimately, Trump will inherit an economy largely shaped by his predecessor, albeit with the opportunity to rebrand and redirect its course. The coming months will be critical in determining whether his policies can alleviate consumer concerns and usher in a period of sustained economic optimism.
