U.S. Consumer Confidence Declines to Five-Month Low Amid Inflation and Job Market Concerns

In September 2025, U.S. consumer confidence fell to its lowest level since April, with the Conference Board's Consumer Confidence Index dropping from 97.8 to 94.2. This decline of 3.6 points was greater than economists' expectations, which had forecasted a decrease to 96.0. The Present Situation Index, reflecting consumers' assessments of current business and labor market conditions, experienced a significant drop of 7 points to 125.4, marking its largest decline in a year.

U.S. Consumer Confidence at Five-Month LowHardware RetailingConsumer Confidence Drops to Five-Month Low in September On Job ConcernsConsumer Confidence Hits 5-Month Low in SeptemberConsumer Confidence Falls Again, Hits Lowest Point Since AprilQuartzConsumer Confidence Worsens Over Inflation, Job Market Worries

The decline in consumer confidence is attributed primarily to increasing concerns about inflation and a weakening labor market. Stephanie Guichard, senior economist at the Conference Board, noted that consumers' perceptions of business conditions have become markedly less positive, and their appraisal of job availability has fallen for the ninth consecutive month, reaching a new multiyear low. This trend aligns with a broader decline in job openings, which has contributed to the overall pessimism.

Consumer Confidence Drops to Five-Month Low in September On Job ConcernsQuartzHardware RetailingConsumer Confidence Falls Again, Hits Lowest Point Since AprilConsumer Confidence Worsens Over Inflation, Job Market WorriesConsumer Confidence Hits 5-Month Low in SeptemberHome Purchase Intent Gained Despite Consumer Confidence Slip in September

The Expectations Index, which gauges consumers' outlook on income, business, and labor market conditions over the next six months, also fell, albeit by a smaller margin of 1.3 points to 73.4. This index has remained below the critical threshold of 80 since February 2025, a level often associated with impending recession. Despite the overall decline, there was a slight increase in optimism regarding future income, which somewhat mitigated the drop in the Expectations Index.

U.S. Consumer Confidence at Five-Month LowConsumer Confidence Drops to Five-Month Low in September On Job ConcernsConsumer Confidence Hits 5-Month Low in SeptemberConsumer Confidence Worsens Over Inflation, Job Market WorriesHardware RetailingFlorida Consumer Confidence Falls for Third Straight MonthConsumer Confidence Falls Again, Hits Lowest Point Since April

Consumer sentiment varied across demographic groups. Younger consumers under 35 reported a rise in confidence, while those over 35 experienced a decline. By income level, confidence remained above April lows for most groups, except for households earning between $25,000 and $35,000 and those earning more than $200,000. Political affiliation also influenced sentiment, with confidence improving slightly among Democrats and Republicans but declining significantly for Independents.

Consumer Confidence Hits 5-Month Low in September

Critics have pointed out that the ongoing decline in consumer confidence could signal deeper economic issues. Concerns about inflation have regained prominence, with references to rising prices becoming the primary topic influencing consumer views. The average 12-month inflation expectation, while slightly down to 5.8% from 6.1%, remains significantly above the 5% level recorded at the end of 2024.

Home Purchase Intent Gained Despite Consumer Confidence Slip in September

The Conference Board's report emphasized the importance of monitoring consumer confidence as it provides insights into prospective consumption patterns. Guichard stated, “Consumer confidence weakened in September, declining to the lowest level since April 2025,” highlighting the significant drop in the present situation component and the ongoing concerns regarding job availability and business conditions.

Hardware Retailing

• “Consumers’ assessment of business conditions was much less positive than in recent months, while their appraisal of current job availability fell for the ninth straight month to reach a new multiyear low.” — Stephanie Guichard, Senior Economist, Global Indicators at The Conference Board.

Hardware Retailing

• “Expectations also weakened in September, but to a lesser extent.” — Stephanie Guichard.

Hardware Retailing

• “Consumers' write-in responses showed that references to prices and inflation rose in September, regaining their top position as the main topic influencing consumers' views of the economy.” — Stephanie Guichard.

U.S. Consumer Confidence at Five-Month Low

The decline in consumer confidence in September reflects growing concerns about inflation and a weak labor market, which could have broader implications for economic growth. As consumers become increasingly cautious, their spending patterns may shift, potentially impacting various sectors of the economy. The situation warrants close monitoring as the Federal Reserve and policymakers navigate these challenges.

Quartz