Consumer Confidence Takes a Hit in June as Tariff Concerns and Economic Uncertainty Persist

Consumer confidence retreated in June, falling below the 98.4 seen in May and the 99.8 that economists had expected, according to the latest index reading from the Conference Board. The expectations index also decreased to 69 in June from 73.6 in May, marking the largest one-month decrease since 2009.

Tariffs remained a top concern for consumers, with many expressing concerns about their negative impacts on the economy and prices. Stephanie Guichard, senior economist of global indicators at the Conference Board, noted that inflation and high prices were another important concern cited by consumers in June.

While the effective US tariff rate has come down significantly from its peak above 25% in early April, it remains significantly higher than where the year started. The Yale Budget Lab estimates the effective US tariff rate is currently 14.7%, the highest level since 1938.

The decline in consumer confidence was also reflected in the labor market differential, which measures the difference between those who say jobs are plentiful and those who say jobs are hard to get. In June, 29.2% of respondents said jobs were "plentiful," down from 31.1% in May, while 18.1% of consumers said jobs were "hard to get," down slightly from 18.4% in May. This pushed the difference between the two to just 11.1 percentage points in June, marking the lowest gap since March 2021 when the job market was recovering from the pandemic.

The declines come as job openings have fallen from the start of 2025 while weekly filings for unemployment claims are hovering near their highest level in eight months. Consumers were more pessimistic about business conditions and job availability over the next six months, and optimism about future income prospects eroded slightly, according to Guichard.

In light of these findings, it's clear that consumer confidence has taken a hit in June as tariff concerns persist. As the economy continues to recover from the pandemic, it will be important to monitor consumer sentiment closely to understand how it may impact spending and economic growth.

[Image: Consumer confidence retreated in June as the highest tariffs in more than 80 years remained a top concern for Americans. (Photo by James Williamson - AMA/Getty Images)]