The Conference Board’s latest data reveals that US consumer confidence declined for the fifth consecutive month in December 2025. Although the end of the federal government shutdown provided a brief respite, growing concerns over employment and a worsening business outlook have driven a key recession indicator further into a risky zone.

Headline Figures

– Consumer Confidence Index fell to 89.1 in December, below expectations of 91.0, and down from a revised 92.9 in November (previously reported as 88.7).
– Present Situation Index dropped sharply by 9.5 points to 116.8, marking the steepest fall in current sentiment. Notably, views on business conditions turned negative for the first time since September 2024.
– Expectations Index remained steady at 70.7 but has now stayed below the crucial 80.0 threshold for 11 consecutive months—a level historically associated with looming recession risks.

Breakdown of December’s Consumer Confidence Numbers

Present Situation: A Shift Towards Pessimism

Consumer perceptions of current conditions deteriorated significantly:

– Business conditions are now seen as “bad” by 19.1% of consumers, outnumbering those who consider them “good” at 18.7%.
– The labour market weakened, with only 26.7% describing jobs as “plentiful,” down from previous levels, while 20.8% feel jobs are “hard to get.”

Expectations: Rising Concerns Over Jobs and Income

Despite a slight improvement in expectations for future business conditions, economic worries persist:

– The proportion of consumers anticipating fewer jobs available increased to 27.4%.
– Income expectations became more divided, with 18.4% expecting income growth but 14.7% anticipating a decrease, both figures showing a rise.

Demographic and Political Insights

The fall in confidence was widespread:

– All age groups experienced declines in confidence except the Silent Generation, which showed some improvement. Millennials and Gen Z, although declining, remained the most optimistic.
– Confidence dropped in nearly all income brackets except the very lowest (under $15,000) and the highest earners (over $125,000).
– The trend of falling confidence cut across political lines, affecting Democrats, Republicans, and Independents alike.

Expert Commentary

Dana M. Peterson, Chief Economist at The Conference Board, observed: “Despite an upward revision in November linked to the end of the shutdown, consumer confidence fell again in December and remained well below this year’s January peak. Four out of five components of the overall index declined, while one remained at a level indicating notable weakness.”

For forex traders, these data points signal increased economic uncertainty in the US, with persistent weakness in consumer confidence and labour market concerns potentially influencing USD valuations and risk sentiment in the coming months.

Original Source: Greg Michalowski of investinglive.com