June 24, 2025
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The Conference Board reported that consumer confidence fell 5.4 points in June to 93.0. However, confidence jumped 12.7 points in May. After hitting a peak in November confidence plunged for five months in a row as consumers worried about the inflationary impact of tariffs and the prospect of possibly losing their jobs. Once Trump relented on many of the tariffs he announced in early April, confidence has rebounded somewhat.
Senior Economist at the Conference Board, Stephanie Guichard, said, “Consumer confidence weakened in June, erasing almost half of May’s sharp gains. The decline was broad-based across components, with consumers’ assessments of the present situation and their expectations for the future both contributing to the deterioration.” She added that, “Consumers’ write-in responses revealed little change since May in the top issues impacting their views of the economy. Tariffs remained on top of consumers’ minds and were frequently associated with concerns about their negative impacts on the economy and prices. Inflation and high prices were another important concern cited by consumers in June.
We have a hard time getting as pessimistic as what this index has been indicating. The economy keeps cranking out new jobs although the pace of job creation has slowed down a bit. Trump is promising significant de-regulation in coming months. Most economists expect GDP growth this year of about 1.0%. We are looking for GDP growth of 2.5% for the year.
Given the magnitude of the earlier declines in confidence in the past thee months one might have expected a sharp pullback in consumer spending. But that has not happened. Instead, real consumer spending has risen 3.2% in the past year. With real disposable income rising 2.9%, we expect consumer spending to climb by about 1.5% in 2025.
Confidence data reported by the Conference Board are roughly matched by the University of Michigan’s series on consumer sentiment. As shown in the chart below, trends in the two series are identical but there can be month-to-month deviations.
Stephen Slifer
NumberNomics
Charleston, SC
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