Americans’ confidence in the economy remains in solidly negative territory as Gallup’s Economic Confidence Index (ECI) holds steady at -19 for February, the same as January.
This index measures both public evaluations of current economic conditions and their outlook on the economy’s future.
The February survey reveals a shift in how Americans view the current state of the economy.
While 20% still consider it “excellent” or “good,” this is down from 26% in January.
On the flip side, the number of people labeling the economy as “poor” dropped from 40% to 33%, with a notable increase in those describing conditions as “only fair,” which now stands at 45%, up from 33% last month.
Meanwhile, according to the University of Michigan’s monthly consumer survey, consumer confidence took a significant dip in February, marking a nearly 10% decline from January.
The Consumer Sentiment Index fell from 71.7 in January to 64.7 in February.
This sharp decrease is largely attributed to consumer concerns over tariff hikes and their potential impact on inflation, The Hill reports.
In early February, President Donald Trump approved a 25% tariff on imports from Mexico and Canada, which were eventually delayed after both countries took steps to curb the flow of drugs at their borders.
Additionally, Trump imposed a 10% tariff on Chinese imports, raised aluminum tariffs to 25%, and reinstated the full power of steel tariffs. These actions sparked worries about rising inflation, with inflation expectations for the next year jumping from 3.3% to 4.3%, while long-term inflation expectations increased from 3.2% to 3.5%.
Alongside the rise in inflation expectations, the consumer price index also showed an uptick, rising 3% year-over-year in January, up from 2.9% in December.
This marked the fourth consecutive month of inflation growth, The Hill adds.
The survey also revealed a partisan split in consumer sentiment. Both Democrats and independents saw a decline in sentiment, while Republicans’ views remained largely unchanged.
Similarly, inflation expectations rose among Democrats and independents but fell slightly for Republicans.
In a recent poll by Emerson College, Trump’s approval rating stood at 48%, with 42% disapproving of his performance.
Despite strong approval for his election win in January, his recent tariff decisions and exploration of territorial expansion have seen a decrease in support, particularly concerning their potential impact on the stock market.
This shift in consumer sentiment highlights growing concerns over economic policies and inflation.
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