US Economic Confidence Falls to Record -45 as Gas Prices Rise Amid Iran War

The Gallup Economic Confidence Index combines two components: views of current economic conditions and expectations for the future, each scored from -100 to +100. The overall index is the average of these two scores, so a negative value means more respondents see the economy as bad or worsening than good or improving. A reading of -45 marks the weakest showing since the pandemic‑era inflation surge of 2022. The decline aligns with a sharp increase in fuel costs after the U.S. and Israel initiated military actions against Iran in late February.

- The index stands at -45, the lowest level recorded since 2022. - Only 16% of respondents describe the U.S. economy as good or excellent; 49% say conditions are poor and 34% call them fair. - Seventy‑six percent believe the economy is getting worse, while 20% think it is improving. - U.S. gasoline averages $4.55 per gallon, compared with under $3 before the Iran war started. - The index’s current conditions component is -33 and its outlook component is -56, which together produce the -45 headline figure.

Low confidence and higher fuel prices together reduce household disposable income, which can lead to cutbacks in non‑essential spending. When consumers spend less on discretionary items, businesses may experience softer sales, potentially slowing hiring and investment decisions. Policymakers often monitor these indicators to gauge the need for measures that ease energy price pressures or support broader economic activity. The situation underscores how external shocks, such as conflict‑driven energy disruptions, can quickly affect domestic sentiment and spending patterns.