U.S. Consumer Confidence Slips in June, Renewing Economic Concerns

The U.S. economy is showing fresh signs of strain. According to the latest data released on June 24 by The Conference Board, consumer confidence in the U.S. dropped sharply in June, falling to 93.0 from May’s 98.4. That 5.4-point decline erased nearly half of the rebound seen the previous month, signaling growing unease about the economic outlook.

Breaking down the numbers, both components of the index weakened. The Present Situation Index — which measures consumers’ assessment of current business and labor market conditions — dropped 6.4 points to 129.1. Meanwhile, the Expectations Index — which gauges views on income, business, and job prospects over the next six months — fell to 69.0, down 4.6 points and well below the 80-point threshold that often signals the risk of a recession.

One of the recurring themes in the report is a weakening sentiment toward the labor market — a trend that’s now persisted for six straight months. Although the job market remains stable on the surface, many consumers are growing wary of future employment growth. Nearly 70% of respondents believe there is a real chance the economy could enter a recession within the next year. This pessimism is no longer just theoretical — it’s beginning to show up in people’s financial behavior. Households are pulling back on big-ticket purchases like homes, cars, and major appliances, opting instead to be more cautious with their spending.

Adding to the uncertainty is the lack of clarity around U.S. trade policy, especially with tariff discussions back in the spotlight. Even though inflation has cooled somewhat and price increases have slowed, new or higher tariffs could push costs back up, presenting another potential drag on the economy.

Stephanie Guichard, a senior economist at The Conference Board, noted that the decline in consumer confidence reflects growing unease with the current economic climate and concerns about future income stability. She emphasized that the U.S. is entering a phase of more cautious spending, where consumers are becoming increasingly selective about opening their wallets — unless absolutely necessary.

Looking ahead, all eyes will be on the labor market and inflation data. Policy decisions from both fiscal and monetary authorities will also play a major role in shaping consumer sentiment. If confidence fails to rebound over the next few months, consumer spending could weaken further, posing a headwind to economic growth in the second half of the year.

For investors, this serves as an important signal to watch. Whether you’re holding U.S. equities, ETFs, or simply looking to time your moves in the economic cycle, consumer confidence data can be a valuable gauge for where the market may be heading next.