Consumer Confidence and Spending Behavior: Signals from 2025
Consumer confidence has long served as a leading indicator of economic health. But in 2025, the relationship between sentiment and spending is becoming more complex. While some households remain resilient, others are pulling back — not just because of financial constraints, but because of fear, uncertainty, and shifting cultural dynamics. For business leaders , understanding these behavioral shifts is essential to navigating demand, pricing, and messaging in a volatile landscape. I. The Confidence Index: A Warning Signal The Conference Board’s Expectations Index — a key measure of consumer outlook — has remained below the recession threshold of 80 for nine consecutive months. This sustained pessimism reflects concerns about inflation, immigration enforcement, political instability, and global conflict. While the Present Situation Index remains relatively stable, the forward-looking sentiment is deteriorating. Key indicators : Holiday spending is projected to decline by 3.9% year-...