The index shows that though solid economic conditions persist, they aren’t translating into consumer optimism

Consumer confidence took a hit in December, dropping 8.1 points in the Conference Board’s index after two months of modest gains. Concerns about income, business, and labor market prospects drove the decline.

Potential tariff increases under the incoming Trump administration are a major worry. Around 45% of consumers expect tariffs to increase living costs, though 21% believe they will create jobs.

The index shows that solid economic conditions persist but aren’t translating into consumer optimism. It signals ongoing tension between economic indicators and public sentiment as the new government sets in.

Meanwhile, the Federal Reserve’s outlook suggests fewer interest rate cuts in 2025 than this year due to slow inflation progress.