American Consumer Confidence Index falls to seven-month low, inflation expectations rise sharply.

Due to escalating concerns over tariff policies, American consumers' expectations for short-term inflation surged, leading to a sharp decline in the Consumer Confidence Index in early February, falling to the lowest level in seven months. Following the release of this data, the three major U.S. stock indexes turned downward, with the Nasdaq falling by 0.9%, while spot gold rose by 0.8%. According to preliminary survey data released by the University of Michigan on Friday, the Consumer Confidence Index for February dropped by 3.3 points to 67.8, lower than all the economist forecasts surveyed by Bloomberg. This data reflects consumers' growing concerns about the economic outlook. The survey shows that consumers expect prices to rise at an annual rate of 4.3% in the next year, a significant increase of 1 percentage point from the previous month. In addition, consumers' inflation expectations for the next five to ten years also slightly increased, with an expected annual growth rate of 3.3%. Currently, the U.S. government is moving forward with tariff policies on major trading partners, which could further push up prices of goods and services. Economists warn that if all tariff policies are implemented as scheduled, causing price increases, consumer spending will be significantly impacted, dragging down overall economic growth. Due to rising inflation expectations and economic uncertainties, consumers' willingness to purchase high-priced items (such as cars, homes, and durable goods) decreased by 12 percentage points from the previous month. It is worth noting that this trend is evident in all political party groups, and the overall decline in consumer confidence is not limited to a particular political stance. Joanne Hsu, director of the University of Michigan Consumer Survey, stated, "Republicans' confidence in the economy surged rapidly after the election but is currently falling, while Democrats remain concerned about the impact of Trump's economic policies." Data shows that confidence among Republican supporters has declined for the first time since August of last year, while confidence among Democratic supporters continues to deteriorate, hitting its lowest level since 2020. In addition, confidence among politically independent individuals also declined. Meanwhile, the labor market is also showing signs of softness. Another set of data released on Friday showed that job growth slowed in January, and the government downwardly revised employment data for the past year, indicating that labor market dynamics are weaker than previously expected. Additionally, more unemployed individuals are facing longer job searches, adding pressure to the job market. The survey also shows that the index for consumers' assessment of the current economic situation dropped from 74 to 68.7, the lowest level in three months; the economic expectations index also declined to 67.3, marking the weakest level since November 2023. Meanwhile, consumers' expectations for their personal financial situations fell to the lowest point since October 2023, and their outlook for the overall economy in the next year has also deteriorated.