In February, consumer confidence in the United States fell sharply, marking the largest decline in four years.

According to the latest report released by a commercial research institution, the consumer confidence index in the United States saw a significant decline in February 2024, marking the largest single-month drop in four years. The report pointed out that the issue of inflation has not been effectively alleviated, and under the influence of former President Donald Trump, more and more Americans believe that a trade war is inevitable. Data released by The Conference Board on Tuesday showed that the consumer confidence index dropped significantly from 105.3 in January to 98.3 in February, much lower than market expectations. According to FactSet's survey, economists had previously expected the index to be 103. However, the actual data showed a seven-point drop, the largest single-month decline since August 2021. The sharp decline in the consumer confidence index had a direct impact on the financial markets. The US stock market subsequently declined, with the Nasdaq plummeting over 1.6%. The report also showed a significant increase in consumer concerns about inflation, as well as a notable increase in discussions about trade wars and tariffs. Additionally, the index for consumers' expectations of income, business environment, and job market in the short term dropped by 9.3 points to 72.9. The Conference Board stated that if this index falls below 80, it may indicate an increase in the risk of an economic recession. The data showed that the proportion of consumers expecting an economic recession in the next year has climbed to the highest level in nine months. At the same time, consumers' evaluation of the current economic situation saw a significant decline, with the index dropping by 3.4 points to 136.5. Furthermore, consumer confidence in the current job market conditions continued to decline. The Conference Board pointed out in the report: "Consumers' views on the current labor market are weakening, while their expectations for the future business environment are becoming more pessimistic, and their optimism about future income growth is decreasing. At the same time, pessimism about future job prospects has reached the highest level in ten months." Although US consumers showed strong consumer confidence during the holiday season at the end of 2024, consumer momentum slowed down significantly in early 2024. Data showed a significant decline in retail sales in January in the US, partly due to the impact of cold weather on the sales of automobiles and retail goods. The US Department of Commerce reported last week that retail sales in January fell by 0.9% compared to the previous month, marking the largest single-month decline in the past year. This data came after two consecutive months of strong growth, raising concerns in the market about the outlook for consumer spending. The consumer confidence index measures Americans' views on the current economic situation as well as their expectations for the economic outlook in the next six months. Since consumer spending accounts for about two-thirds of economic activity in the US, the fluctuation of this index is of significant importance for economic development. Economists closely monitor changes in the consumer confidence index to assess the overall health of the US economy.