Consumer Confidence Falls to Lowest Level Since April
Consumer confidence decreased 3.6 points in September to 94.2, the lowest level since April. Among its components, the Present Situation Index and Expectations Index both declined, with consumers’ pessimism about future job availability and future business conditions being partially mitigated by stronger expectations about future income.
The Present Situation Index, reflecting current business and labor market conditions, fell 7 points to 125.4. Meanwhile, the Expectations Index, which reflects consumers’ short-term outlook for income, business and labor market conditions, declined 1.3 points to 73.4, remaining below the recession signal threshold of 80 since February 2025.
Views of the current labor market situation are still poor, with 26.9% of consumers saying jobs were “plentiful,” down slightly from August (30.2%), while 19.1% said jobs were “hard to get,” unchanged from August and up from 14.5% in January. Looking to the future, 25.6% anticipate fewer available jobs in the next six months, down slightly from 25.9% the prior month.
Mentions of high prices and inflation rose in September, regaining the top position influencing consumers’ views of the economy. Meanwhile, mentions of tariffs declined in September but continued to be associated with concerns about higher prices. Consumers’ 12-month inflation expectations stepped down from 6.1% to 5.8% in September. Meanwhile, 51.9% of consumers, compared to 52.1% in August, expect interest rates to rise, and a larger share of consumers (25.6% vs. 23.6% in August) expect rates to fall.
Buying plans for cars decreased in September, while buying plans for homes increased to a four-month high. Consumers’ plans for buying big-ticket items changed little overall in September but exhibited variation across items. For example, intentions to purchase TVs and dryers rose the most, while refrigerators saw the largest declines. Vacation intentions fell again to the lowest level since April, with lower intentions to travel abroad driving the decline. Overall, consumers’ views of their current and future financial situation declined slightly from August.