Economic concerns grow as consumer confidence plummets in April: “Recession appears dead-ahead”
American consumers expressed more pessimism about the state of the US economy as Trump’s tariffs cause disruptions that could result in a recession.
Normally a US president gets to take credit when the economy booms and blamed when it goes bust despite having little control over it. However, Donald Trump’s erratic policy decisions over tariffs and the trade war he’s instigated can be directly tied to the best performing economy in the world going into reverse.
Trump’s “Liberation Day” announcement, that slapped sweeping tariffs on goods from nearly every nation, wreaked havoc on the stock and bond markets which finally caused him to pause implementing most of the “reciprocal” tariffs until July. While he says that the economy will be “OK” in the long term, Trump says that Americans will have to put up with some “disturbance” during a period of “transition.”
“Recession appears dead-ahead”
The US economy contracted for the first time in three years in the first quarter of 2025, shrinking 0.3%, as companies imported as much as they could before tariffs took effect and prices increased more than predicted. Additionally, consumer confidence took another hit in April falling by 7.9 points to 86, according to the Conference Board Consumer Confidence Index, its lowest level in five years.
Mark Zandi, Chief Economist of Moody’s Analytics pointed out that over the past three months, consumer confidence is down19.3 points, close to 20 point threshold for a recession. “Unless the trade war cools off very (very) soon, recession appears dead-ahead,” he said in a post on social media.
On the bright side though, he highlighted that the drop was mostly due to lower consumer expectations. “Present assessments are holding up better,” he explained. “This suggests confidence could recover quickly with good news on the trade war, heading off a recession.”
He notes that the job market is “the firewall forestalling a recession.” However, he says that the data that came out of the survey “shows cracks are forming” in the job market. Also, he points out that respondents’ views on whether jobs were “plentiful” or “hard to get,” which are a good predicter of unemployment, are heading in the wrong direction.
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