U.S. Consumer Confidence Rebounds in May, Driven by Improved Expectations

U.S. consumer confidence rose sharply in May, breaking a five-month streak of declines, according to The Conference Board. The Consumer Confidence Index® climbed 12.3 points to 98.0, while the Expectations Index, which gauges consumers’ short-term outlook, jumped 17.4 points to 72.8—though it remained below the 80-point recession threshold. The Present Situation Index also rose to 135.9, reflecting a more favorable view of current business conditions.

The improvement was broad-based across all age, income, and political groups, with the strongest gains among Republicans. The rebound gained momentum following the May 12 announcement of a pause on some U.S. tariffs on Chinese imports, easing consumer concerns about trade tensions.

Consumers became less pessimistic about future business conditions, employment prospects, and income, while their confidence in the stock market also rose. The share of those expecting stock prices to increase jumped to 44%, up from 37.6% in April. Meanwhile, inflation expectations eased to 6.5%, down from 7% last month.

Spending intentions strengthened across the board. Consumers reported increased plans to buy homes, cars, appliances, and electronics, and to spend more on services, especially dining out, entertainment, and travel. While concerns about inflation and tariffs persisted, some respondents noted signs of easing prices, particularly at the pump.

A special survey section revealed shifting financial behaviors: 36.7% of consumers reported saving more, while over a quarter dipped into savings or postponed major purchases. Concerns about affordability outweighed job security, with nearly 50% worried about paying for essentials and non-essentials, compared to just 24% concerned about potential job loss.