Key Points

  • The Conference Board reported Tuesday that its consumer confidence index rose 0.8 points to 91.8 in March, as optimism about current business and labor market conditions outweighed pessimism about the economy over the next six months, despite a surge in oil prices due to the Iran war.
  • Rising oil prices and tariffs pushed short-term inflation expectations to theirhighest level since August 2025。
  • "Consumers' written responses regarding factors affecting the economy remained tilted toward pessimism," Dana Peterson, chief economist at the Conference Board, said in a statement. "Comments about prices and the cost of goods indicate that the cost of living remains consumers' top concern."

Deeper Analysis

The rise in the confidence index contrasts with a survey from the University of Michigan released Friday, which showed household sentimentfell 6% in March to its lowest level this yearas the Iran war pushed up oil prices and weighed on stocks.

However, both surveys align on concerns about short-term inflation. The University of Michigan survey showed consumers' inflation expectations for the next 12 months rose to 3.8% from 3.4% in February, marking the largest one-month increase since April 2025.

Heather Long, chief economist at Navy Federal Credit Union, said the Conference Board's results "show growing concerns about rising prices, especially oil, and hesitation among consumers about big-ticket purchases amid uncertainty surrounding the Iran war and daily life."

"Stress is beginning to show, especially with national gas prices at $4 per gallon," Long noted in the report. "With the most severe phase of the inflation shock hitting consumers, spending and GDP growth in the second quarter will almost certainly be weak."

Consumers are also anxious about the labor market. The Conference Board said the share of households saying jobs are scarce rose to 21.5% from 21% in February, the highest level in more than five years.

Meanwhile, the proportion of consumers saying jobs are plentiful rose to 27.3%. Compared with February, the gap between consumers with optimistic and pessimistic views on job availability changed little.

A Labor Department report on job openings confirmed this bleak outlook, showingjob openings fell in Februaryand the hiring rate slowed to 3.1%, the lowest level since April 2020, during the early pandemic.

"This is a hiring recession," Long said. "The only bright spot is that layoffs and the quit rate also remain low."

"As businesses face cost pressures from rising energy prices and ongoing AI investment demands this spring, it's not very likely that more companies will turn to layoffs to cut costs," she added.

The Labor Department's Bureau of Labor Statistics reported Tuesday that job openings fell to 6.9 million in February from 7.2 million in January.