Consumer confidence drops to lowest level in more than a decade

Consumer confidence dipped in September to its lowest level in a dozen years, the Conference Board reported Tuesday.

The board’s consumer confidence index fell to 81.9 last month, down 6.7 points from August. That marked the lowest point for the metric since 2014, when consumer sentiment was rebounding from a low point of less than 30 during the financial crisis.

The expectations index, a six-month outlook of future economic conditions, also declined by 3.2 points in September to nearly 60. That metric dipped to less than 60 last year, the first time it had done so since 2013.

Annual inflation has remained above the Federal Reserve’s 2 percent target for more than five years and has risen this year amid the Iran war .

The Middle Eastern conflict , which hit the seven-month mark on Monday, has resulted in energy price spikes due to the Islamic Republic’s restrictions on shipping in the Strait of Hormuz.

Dana Peterson, the Conference Board’s chief economist, noted that consumer appraisals of present business conditions in September were negative for the first time in two years.

“Perceptions of the current labor market also worsened, though remained within positive territory,” Peterson added in the board’s data release. “Over the next six months, consumers expected both business conditions and the labor market to weaken.”

“Consumers still anticipated their household incomes to rise, but less so compared to previous months.”

The University of Michigan Surveys of Consumers index, another measure of public confidence in the economy, also fell to 48.1 last month, down 7 percentage points from September 2025.

Fed officials do not expect inflation, as measured by the personal consumption expenditures (PCE) price index, to fall to 2 percent until 2029, according to the median estimate in the central bank’s latest summary of economic projections.

The Bureau of Economic Analysis will release PCE data for August on Wednesday. The Federal Reserve Bank of Cleveland projects that annual inflation , as measured by the PCE, was 3.9 percent last month — up from 3.7 percent in July .

To combat persistent inflation, the Federal Open Market Committee (FOMC) hiked interest rates by a quarter point earlier this month, to a range of 3.75 percent to 4 percent.

The unanimous decision from the FOMC came after President Trump urged officials to cut rates . Elevated inflation amid the unpopular Iran conflict has also made life difficult for GOP lawmakers seeking to maintain the party’s control of Congress in November.