In April, the Conference Board Consumer Confidence Index® dropped by 7.9 points to 86.0, marking its lowest level since the onset of the COVID-19 pandemic. The sharp decline was driven by increased pessimism about the future, as the Expectations Index dropped 12.5 points to 54.4—a 13-year low and well below the recession-warning threshold of 80. Meanwhile, consumers' views on current conditions held relatively steady, with the Present Situation Index dipping slightly by 0.9 points to 133.5. Notably, outlooks for business conditions, employment, and income all worsened significantly. Sentiment fell most sharply among high-income households and individuals aged 35 to 55. Concerns over tariffs, inflation, and volatile financial markets were key contributors to the decline, with more consumers anticipating fewer job opportunities, reduced income, and falling stock values. Plans for big purchases and services dropped significantly, suggesting growing economic concern.

The Commerce Department’s first estimate on the first-quarter gross domestic product (GDP) growth reported the economy contracted at a seasonally adjusted annual rate of 0.3%. The decline was primarily driven by a 41.3% surge in imports — a 5.03 percentage point negative contributor to GDP — and a 5.1% drop in federal government spending. Increases in consumer spending (+1.8%), investment (+21.9%), and exports (+1.8%) partially offset the decline. Consumer spending growth slowed to 1.8% as compared to 4.0% the previous quarter. Inflation climbed, with the price index for gross domestic purchases growing by 1.2 percentage points to 3.4%. The Personal Consumption Expenditure (PCE) price index also saw a substantial jump of 1.2 percentage points to 3.6%. The core PCE index, which excludes food and energy, increased 0.9 percentage points, reaching 3.5%. Although overall GDP decreased, a core measure of economic strength – "real final sales to private domestic purchasers" – grew a healthy 3.0% in Q1, slightly up from 2.9% in Q4.

The U.S. Bureau of Labor Statistics reported an increase of 177,000 jobs in April as the unemployment rate held steady at 4.2%. The number of unemployed increased slightly to 7.165 million. A year earlier, the unemployment rate was 3.5%, and the number of unemployed was 5.894 million. Job gains were reported in several sectors, with health care adding 51,000 jobs, transportation & warehousing up by 29,000, financial activities increasing by 14,000, and social assistance gaining 8,000 positions. In contrast, federal government employment declined by 9,000 jobs. Average hourly earnings grew by 0.2% to $36.06, marking a 3.8% increase over the past year. The labor force participation rate edged up slightly to 62.6%. Meanwhile, long-term unemployment rose slightly to 1.674 million—23.5% of the total unemployed—and permanent job losses reached 1.915 million. Revisions to February and March data showed that 58,000 fewer jobs were added than previously reported.