Consumer confidence index

The Consumer Confidence Index (CCI) is projected to decrease by 7.9% in 2025, reaching 96.28 . This downturn is due to persistent economic uncertainty and adjustments to tariff policies by the second Trump Administration. High borrowing costs from elevated interest rates in 2024 continue to weigh on consumer sentiment. The Federal Reserve's first interest rate cut since the COVID-19 pandemic, announced in September 2024, is expected to moderate the decline. Market adjustments and initial policy shocks are leading consumers to adopt a cautious outlook.

Between 2020 and 2025, the CCI experienced significant volatility due to global macroeconomic disruptions, inflationary pressures, and monetary policy shifts. A sharp rebound in 2021 saw the index rise 10.8% as vaccine rollouts and business reopenings accelerated economic activity. This resurgence followed a steep 21.1% decline in 2020 amid the COVID-19 outbreak, which caused labor market uncertainty and suppressed consumer optimism. However, renewed confidence in 2021 led to inflation pressures as pent-up demand outpaced supply, especially for fuel and groceries.

Inflationary concerns became more pronounced in 2022, prompting the Federal Reserve to undertake quantitative tightening and raise interest rates aggressively. Consumer confidence fell 7.0% that year, with lower-income households disproportionately affected by rising food and energy costs. Continued rate hikes into 2023 added strain on household budgets, although the CCI managed a 2.0% gain due to labor market resilience. Geopolitical risks, particularly the ongoing war in Ukraine and sanctions on Russia, further pressured confidence. In 2024, the index fell another 1.6% as borrowing costs remained high despite a brief pause and rate cut from the Federal Reserve.

From 2020 to 2025, the CCI reflected both recovery from pandemic-driven lows and macroeconomic challenges in an inflationary, volatile environment. Labor market growth provided some stability for sentiment, but real wage pressures and trade policy uncertainty limited robust improvements in consumer confidence.