The shadow of tariffs lingers, U.S. consumer confidence unexpectedly declines in June.

In June, consumer confidence in the United States unexpectedly fell, highlighting people's ongoing concerns about the potential impact of high tariffs on the economy and job market. The U.S. Conference Board released data on Tuesday showing that its consumer confidence index dropped 5.4 points to 93 in June, below the expected range of all economists surveyed by foreign media. The decline in the index almost erased the rebound in May due to the temporary tariff agreement reached between the U.S. and China. The data shows that the index reflecting consumers' expectations for the next six months dropped by 4.6 points, with the proportion of respondents expecting an improvement in future business conditions experiencing the largest decline in over two years. The current economic conditions index also fell by 6.4 points. Heather Long, Chief Economist at the Navy Federal Credit Union in the United States, commented, "It is not surprising that consumers are cautious about making large expenditures in the current environment. They are basically in a wait-and-see mode and will not buy homes, cars, or large appliances unless absolutely necessary. It is now a 'highly cautious economy.'" The survey was conducted until June 18, just five days after Israel launched a series of attacks on Iranian targets. While geopolitics became a topic mentioned by some respondents, the impact remains limited, with tariff issues still being the core concern of most people. The data shows that the proportion of consumers who believe "jobs are plentiful" decreased to 29.2%, the lowest in over four years. The proportion of those who believe "jobs are hard to get" has also slightly decreased. The difference between the two (which is an important measure for economists to gauge labor market tightness) has decreased to 11.1 percentage points, the lowest level since March 2021. Despite this, Federal Reserve Chairman Powell testified in Congress on Tuesday that the job market and overall economy remain strong. He also emphasized that policymakers will not rush to cut interest rates and are still waiting for more clear signals on trade policy and economic trends. Although the proportion of consumers expecting an increase in income in the next six months has decreased, the committee noted that most consumers still hold a relatively optimistic outlook on their personal financial situations, possibly supported by the rebound in the U.S. stock market and improved prospects in the investment market. In terms of willingness to consume, there is a divergence in the willingness to purchase large items; the intention to purchase cars remains unchanged, while the number of consumers planning to buy houses has decreased. Previous data showed that U.S. retail sales fell for the second consecutive month in May. It is worth noting that the proportion of consumers expecting interest rates to rise in the next year has increased to 57%, the highest level since October 2023. Since the Trump administration restarted tariff policies to address trade imbalances, promote the reshoring of manufacturing, and strengthen the country's industrial base, consumer confidence in the United States has shown a gradual decline. Eliza Winger, an economist at Bloomberg Economics, pointed out: "Consumer confidence in June almost wiped out all the rebound in May, and tariffs remain the biggest concern. With some goods facing price increases this summer, consumer anxiety will further intensify." In fact, U.S. businesses are also struggling to adapt to rapidly changing tariff policies. In April of this year, the U.S. government announced a new round of high tariff policies with multiple trading partners, although the implementation time was ultimately postponed to July, leaving companies unprepared. At the same time, many companies also have to deal with tariffs targeting specific industries, such as steel and aluminum. Recent survey data shows that U.S. manufacturers are facing higher input costs and are passing most of these cost increases on to consumers.