Economy on Edge? Consumer Confidence Takes a Dive

US consumer confidence plummeted in February, with the Conference Board’s Consumer Confidence Index falling to 98.3 from 105.3, the lowest point since June 2024. This sharp decline reflects weakening views on current business and job market conditions. The Present Situation Index dropped 3.4 points to 136.5, while the Expectations Index, reflecting short-term outlook for income, business, and employment, fell even more sharply by 9.3 points to 72.9.

Conference Board Senior Economist Stephanie Guichard highlighted this as the largest monthly drop in consumer confidence since August 2021, marking the third consecutive month of decline and the lowest overall index reading since 2022. While views on present business conditions saw slight improvement, assessment of the current labor market worsened. Looking ahead, consumers expressed increasing pessimism about future business conditions, declining optimism about future income, and heightened concerns about job security, which reached a ten-month high.

This news has put downward pressure on the US dollar, causing the US Dollar Index (DXY) to retreat from recent gains and approach multi-week lows around 106.30.