Consumer Confidence Takes Historic Nosedive in Trump’s Early Months Amid Tariff Fears
President Donald Trump’s return to the White House has been marked by a steep and sudden decline in consumer confidence—falling faster than at any time since the 1990 recession.
Daniella Knight, a mother of three from Annapolis, Maryland, says she’s already feeling the pressure. “I’m terrified,” she said, worried that Trump’s tariffs will drive up everyday prices. “Politicians won’t feel it if the price of milk or electronics goes up—but families like mine will.”
Despite campaigning on promises to revive the economy and ease financial stress, Trump’s early economic moves—especially sweeping tariffs—have rattled markets and fueled anxiety. Polls show that many Americans feel worse off than they did when Trump took office just months ago.
Consumer sentiment has dropped sharply, with Americans increasingly pessimistic about their finances, job prospects, and the broader economy. Many are cutting back on spending, skipping large purchases, and tightening household budgets—moves that are already being felt by businesses.
“Sentiment across consumers, investors, and businesses is down, and that matters,” said Mark Zandi, chief economist at Moody’s Analytics. “That kind of uncertainty will weaken the economy.”
According to University of Michigan’s long-running consumer sentiment survey, expectations have dropped around 30 points since January—the steepest early-term drop for a president in more than three decades. “This isn’t a normal post-election fluctuation,” said Joanne Hsu, the survey’s director. “It’s a major decline.”
Tariffs are a recurring concern among respondents, even though they aren’t directly mentioned in survey questions. While some tariffs have been paused, others—such as a 10% baseline tariff on many imports—remain in place, adding to consumer uncertainty.
Gallup recently found a record 53% of Americans say their financial situation is worsening—surpassing the peak pessimism of the early pandemic. And Fed data shows fewer people expect financial improvement, with more anticipating decline.
The political divide is stark: Republicans, buoyed by Trump’s return, now report far more confidence than during the Biden years. But even among Trump voters, worry is growing. Support for tariffs among Republicans has dipped slightly, while opposition has risen.
Still, the White House remains optimistic. “President Trump’s policies created historic economic growth during his first term, and we’re doing it again,” said spokesman Kush Desai.
But signs of strain are mounting. Retailers and homebuyers are pulling back. Redfin reports one in four Americans are canceling major purchases due to tariff-related uncertainty. Airlines and major brands like Chipotle and Procter & Gamble are lowering expectations as consumer spending slows.
Mortgage delinquencies are on the rise, especially among first-time and lower-income buyers. Job security fears are also increasing: nearly a third of workers say they’re worried about layoffs, according to recent surveys.
“People make decisions based on what they think is coming,” said Hsu. “If they don’t feel confident, they stop spending—and that drives the economy.”
For Knight, the outlook is clear: “I’m already trying to find ways to cut back, but with kids, that’s not easy. Prices are rising, and it feels like there’s no safety net.”