American consumers were feeling less confident this month amid continued volatility in the financial markets.
The Conference Board, a business research group, reported Tuesday that its consumer confidence index fell to 124.1 in March from 131.4 in February.
The index, covering through March 14, measures consumers’ assessment of current economic conditions and their expectations for the next six months. Both declined in March.
The index had climbed in February amid a rebound in the stock market after Christmas and an end to the partial shutdown of the federal government, as well as signs of progress toward ending the trade standoff between the U.S. and China.
Economists pay close attention to the Conference Board index because consumer spending accounts for about 70% of U.S. economic activity.
“Consumers remain confident that the economy will continue expanding in the near term,” said Lynn Franco, the Conference Board’s senior director of economic indicators. “However, the overall trend in confidence has been softening since last summer, pointing to a moderation in economic growth.”
In addition to the markets’ swings, consumer confidence was suppressed in March by a weak employment report for February, issued by the government on March 8. It showed that hiring tumbled last month, with U.S. employers adding just 20,000 jobs, the smallest monthly gain in nearly a year and a half.
The hiring slowdown came amid signs that growth is slowing because of a weaker global economy and the trade war between the U.S. and China.
President Donald Trump is sending U.S. officials to China this week in an effort to resolve the trade dispute. Following the meetings in Beijing, the U.S. will host a delegation from China led by Vice Premier Liu He early next month.
Trump has imposed tariffs on $250 billion of Chinese imports, about half what the U.S. buys from that country. China retaliated with tariffs on about $110 billion of U.S. goods.
A slowdown in manufacturing and retail, sluggish housing and construction activity and global pressures, including the ongoing trade war with China, have dampened expectations for economic growth.
Reflecting the dimmer view of the economy as growth slows in the U.S. and abroad, the Federal Reserve last week left its key interest rate unchanged—and signalled that it won’t be raising rates anytime soon.
The nation’s business economists, in a survey out Monday, foresee a sharp slowdown in U.S. economic growth over the next two years. The finding from the National Association for Business Economics contrasts starkly with the Trump administration’s predictions that growth will accelerate this year and next.
Still, experts say, the economy remains on strong ground as its expansion—the second-longest on record—continues.
The economy, as measured by the gross domestic product, grew 2.9% last year, the fastest pace since 2015. The economy benefited from new tax cuts and increased government spending, the gains from which are now thought to be fading. Many economists forecast that growth could fall below 1% in the first quarter.