Consumer Confidence Falls Below Pandemic Lows in January

New York—U.S. consumer confidence in January fell to its lowest level since May 2014, surpassing even the lows of the COVID-19 pandemic.

The Conference Board’s monthly Consumer Confidence Index fell to 84.5 in January from an upwardly revised 94.2 in December.

The five-point revision in December reversed the initially reported decline for the month.

“Confidence collapsed in January, as consumer concerns about both the present situation and expectations for the future deepened,” said Dana M. Peterson, chief economist at The Conference Board. 

“All five components of the index deteriorated, driving the overall index to its lowest level since May 2014 (82.2)—surpassing its COVID-19 pandemic depths.”

The Conference Board’s Present Situation Index, which measures consumers’ current view of business and labor market conditions, fell to 113.7 in January from 123.6 in December.  

The labor market differential—the share of consumers saying jobs are “plentiful” minus the share saying jobs are “hard to get”—continued to fall.

The Expectations Index, which measures consumers’ outlook on income, business, and labor market conditions in the near future, fell to 65.1 in January from 74.6 in December.

It marks the twelfth consecutive month that expectations remained below the threshold of 80, a level which typically signals a recession is ahead, according to The Conference Board.

Expectations for business and labor market conditions six months from now continued to fall while the outlook for household incomes was also more pessimistic. 

By demographic, confidence on a six-month moving average basis fell for all age groups in January.

However, consumers under 35 continued to be more confident than consumers age 35 and older, with Gen Z the most optimistic of those surveyed.

By income, confidence on a six-month moving average basis was down for all groups, with those earning less than $15,000 still the least optimistic.

By political affiliation, confidence was down for everyone, with Independents seeing the biggest decline.

“Consumers’ write-in responses on factors affecting the economy continued to skew towards pessimism,” said Peterson.

“References to prices and inflation, oil and gas prices, and food and grocery prices remained elevated. Mentions of tariffs and trade, politics, and the labor market also rose in January, and references to health/insurance and war edged higher.”

The survey also asked consumers about their interest rate expectations.

Fewer respondents said they expect interest rates to be net higher 12 months from now. This follows the Federal Reserve’s decision to cut monetary policy rates in December.

The balance of consumers’ expectations for stock prices 12 months from now—higher minus lower—retreated after an uptick.

When asked about their view of their family’s current financial situation, the responses improved slightly in January.

However, their expectations for their family’s future financial situation were more pessimistic.

As for a recession, more people said a recession in the next 12 months is “very likely” and more people said the United States is “already in one.” These measures are not included in calculating the Consumer Confidence Index.

Looking at plans for big-ticket purchases, consumers seemed more cautious over the next six months, The Conference Board said, with fewer people saying “yes” to a big purchase and more saying “no” and “maybe.”

Overall buying plans for automobiles were flat in January. Plans to buy news cars continued to fall on a six-month moving average basis, while plans to buy used cars rose.

Plans to buy a home continued to slip, as did plans to buy refrigerators, dishwashers, furniture, and TVs.

Plans to buy electronics fell in all categories except smartphones.

Used cars, furniture, TVs, and smartphones remained the most popular within their categories for future purchases.

Plans to spend on services were weaker in January.

“Consumer spending trends in 2025 moved towards cheap thrills and necessary services, and away from expensive and highly discretionary activities. These behaviors spilled over into the new year,” said The Conference Board.

In January, the top categories for planned services spending were restaurants, bars, and take-out.

Respondents also said they intended to spend more on hotels or motels for personal travel, motor vehicle services, household maintenance, and airfare or trains for personal travel. 

“The increased intentions to spend more on travel-related services in the first half of 2026 was surprising, given the plunge in vacation plans, especially for domestic travel, also recorded in the survey,” said The Conference Board.

The Consumer Confidence survey results for February are scheduled to be released on Feb. 24.