U.S. consumers’ outlooks on the state of the economy and labor market showed “modest improvement” in March, though expectations for future conditions worsened slightly on account of the Iran war, now in its fifth week, according to newly published survey results from The Conference Board.
The findings released Tuesday reflect the first monthly survey of consumer sentiment conducted by the nonprofit think tank and research group — which began publishing its popular Consumer Confidence Index in 1967 — since the U.S. and Israel initiated hostilities on Feb. 28.
“Three of five components of the Index firmed in March, and overall confidence improved modestly for a second month,” said Dana M. Peterson, chief economist at The Conference Board, in commentary accompanying the results. “Nonetheless, the Index has been on a general downward trend since 2021.”
The overall consumer sentiment index rose 0.8 points to 91.8 in March, sustaining a recovery from January’s measure of 84.5, which had been the lowest index reading since May 2014. Consumer confidence soured notably in 2025 amid tariff uncertainties, labor market weakness and a riptide of geopolitical volatility.
Among component indexes, the Present Situation Index, which measures consumer confidence in current business and job market conditions, added 4.6 points to land at 123.3. The Expectations Index, meanwhile, which assesses consumers’ short-term outlooks for income, business and labor markets, shed 1.7 points to land at 70.9.
“While not obvious in the headline or its component indexes,” the report explained, “the weight of rising costs due to tariff passthrough and spiking oil prices was evident among other measures in the survey like inflation expectations.”
The share of respondents reporting that they expect interest rates to be higher over the next 12 months rose from 34.9% in February to 42.4% in March, for example, which the report called unsurprising “given the Iran war oil shock.” Consumers’ average and median year-ahead inflation expectations spiked in March “to levels last seen in August 2025.”
Correspondingly, consumers’ expectations for higher stock prices 12 months into the future “plunged.” Complementing that trend, the percentage of consumers who said they believe it is “very likely” that the U.S. falls into a recession in the next year rose.
“Consumers’ write-in responses on factors affecting the economy continued to skew towards pessimism,” added Peterson. “Comments about prices and the cost of goods suggest that the cost of living remained at the top of consumers’ minds.”
Prospective homebuyers also tempered their expectations, the survey revealed.
“Homebuying expectations were somewhat lower on a six-month rolling basis for both existing and new units in the month, with consumers continuing to prefer existing homes to newly built ones,” the report stated.
