Consumer confidence in the United States has declined for the third consecutive month, as ongoing trade disputes, inflation concerns, and economic uncertainty continue to weigh on sentiment.

According to the University of Michigan’s latest consumer sentiment survey, confidence dropped by 10.5% in March, bringing the index down to 57.9—a sharp 27.1% decline compared to March 2024.

Widespread Decline in Sentiment Across All Demographics

The survey found that the decline in consumer confidence affected all demographics, including:
Age groups
Education and income levels
Political leanings
Geographic locations

While perceptions of current economic conditions remained relatively stable, expectations for the future worsened significantly.

Consumers cited concerns over:
Job security and employment opportunities
Inflation and rising costs
Personal financial stability
Business conditions and economic policies

"Many consumers pointed to the significant uncertainty surrounding policies and other economic factors," said Joanne Hsu, director of the survey.

Inflation Expectations Surge to New Highs

Short-term inflation expectations (one-year outlook):

• Increased from 4.3% in February to 4.9% in March—the highest level since November 2022.
• This marks the third consecutive month where inflation expectations have risen by at least 0.5 percentage points.

Long-term inflation expectations (five-year outlook):

• Jumped from 3.5% in February to 3.9% in March.
• This is the steepest month-over-month rise in inflation expectations since 1993.

"Unpredictable shifts in economic policies make financial planning increasingly difficult, regardless of political alignment," Hsu added.

Trade Tensions and Tariffs Add to Economic Uncertainty

The trade environment remains tense, following President Donald Trump’s tariff policies on imports from China, Canada, and the European Union.

These tariffs were introduced, suspended, and then reimposed, creating market volatility.

On March 13, Trump warned of a potential 200% tariff on European imports, targeting:
Wine
Cognac
Other alcoholic beverages

Retaliatory tariffs from trading partners could further impact consumer prices and economic stability.

Economic Uncertainty Clouds Future Outlook

With rising inflation, ongoing trade disputes, and policy uncertainty, consumer confidence in the U.S. continues to deteriorate. The impact of tariffs, job concerns, and inflationary pressures will likely shape consumer sentiment and spending patterns in the coming months.