Consumer attitudes worsen more than expected amid Trump's tariffs: Survey

Consumer attitudes worsened in March as President Donald Trump's tariffs set off a market rout and warnings of a possible recession, The Conference Board survey data on Tuesday showed. Sentiment worsened more than economists expected.

The gauge marked the fourth consecutive month of worsening attitudes, dropping to its lowest level since 2021.

Expectations of future income had held steady even during the recent decline in overall sentiment, but that measure of anticipated income fell notably in March, The Conference Board said.

Income fears suggest "worries about the economy and labor market have started to spread into consumers’ assessments of their personal situations," Stephanie Guichard, senior economist of global indicators at The Conference Board, said in a statement.

The fresh data on consumer sentiment arrives a week before the onset of additional U.S. tariffs, indicating potential fear of further escalation in an ongoing global trade war.

Trump has repeatedly referred to April 2 as "liberation day," saying a wide-ranging slate of reciprocal tariffs would rebalance U.S. trade relationships.

Trump’s plan for reciprocal tariffs next week, however, is expected to be more targeted and narrower than he previously vowed, though the plan remains under discussion, sources told ABC News on Monday. The administration is focused on trading partners who have major trade imbalances with the U.S., the sources said.

The news of a potentially softer approach to forthcoming tariffs rallied U.S. stocks on Monday, recovering some of the losses suffered earlier this month. The major stock indexes moved slightly higher in early trading on Tuesday.

Consumer sentiment appears to align with dampening expectations at the Federal Reserve. Last week, the Fed predicted weaker year-end economic growth and higher inflation than it had in a December forecast.

Speaking at a press conference in Washington, D.C., last Wednesday, Fed Chair Jerome Powell faulted tariffs for a "good part" of recent inflation.

By some key measures, however, the economy remains in solid shape. A recent jobs report showed steady hiring last month and a historically low unemployment rate. Inflation stands well below a peak attained in 2022, though price increases register nearly a percentage point higher than the Fed's goal of 2%.

Still, recession fears are mounting on Wall Street as businesses and consumers weather the trade war. Goldman Sachs earlier this month hiked its odds of a recession from 15% to 20%. Moody's Analytics pegged the chances of a recession over the next year at 35%.

Consumer spending, which accounts for about two-thirds of U.S. economic activity, could weaken if shopper sentiment sours, Bret Kenwell, U.S. investment analyst at eToro, told ABC News in a statement.

"A cut-back in spending has the potential to reverberate throughout the economy," Kenwell said.