U.S. consumer confidence slid sideways in October as improved views on the present situation were mostly offset by weaker expectations for future business and employment conditions.
The Consumer Confidence Index only dipped one point lower to 94.6 from September’s upwardly revised reading of 95.6, according to The Conference Board, a nonprofit research group that publishes the monthly index.
The board’s Expectations Index, which gauges consumers’ short-term outlook for income, business and labor market conditions, declined 2.9 points to 71.5. A reading below 80, which has occurred every month since February, typically signals a recession ahead.
Stephanie Guichard, senior economist for global indicators at The Conference Board, noted in a press release that consumers’ views of current job availability rose for the first time since December 2024 — with a caveat.
“Consumers were a bit more pessimistic about future job availability and future business conditions while optimism about future income retreated slightly,” Guichard added.
The Present Situation Index, which assesses consumers’ attitudes on current business and labor market conditions, gained 1.8 points to 129.3.
Confidence declined in October for consumers under 35 years old and income groups earning less than $75,000 annually, while improving for consumers aged 35 to 54 and income groups earning more than $75,000 annually.
The largest gain in confidence by income group occurred among those earning more than $200,000 annually.
“By partisan affiliation, confidence improved among independents, declined among Democrats, and was also slightly down among Republicans,” the report read, noting that write-in-response references to U.S. politics “were up notably, with the ongoing government shutdown mentioned multiple times as a key concern.”
Overall, consumers’ expectations for 12-month inflation and interest rates soured while expectations for stock market performance remained strong. Nearly half of consumers expected stock prices to increase over the next year, while 28.5% of consumers expected stock prices to decline, a 1.1% rise from September.
The share of consumers who think a recession is “very likely” over the next 12 months declined in October, but the share of consumers thinking that the economy is already in recession increased for a third straight month.
With the holiday shopping season already underway for many consumers, the board’s early data suggest consumers expect to spend 3.9% less on gifts and 12% less on non-gifts, with “promotions and getting the most out of every dollar” driving holiday spending decisions.
“In addition to promotions, consumers also indicated that they will likely buy fewer goods if the price of imported items is inflated by tariffs,” the report indicated.
