The Great Consumer Cooldown: As Confidence Slips And Budgets Shrink, Even Wall Street Admits The American Shopper Is Tapped Out

• According to Numerator data as of Wednesday, consumer confidence held steady in November, though it remains at a four-year low.
• The data showed that the consumer confidence score was 53.9 in November, flat compared to October and down from 56.2 in November 2024. 
• JPMorgan in November noted that tariffs weighed on parts of the economy, with hiring slowing sharply and trade policy uncertainty spiking. 

It’s been the kind of year that tests the national mood. President Donald Trump's tariffs have rippled across global markets, a government shutdown has dragged on longer than anyone expected, and the combined weight of these macro shocks has seeped into households, cooling the optimism that typically fuels American spending.

According to Numerator data as of Wednesday, consumer confidence held steady in November, though it remains at a four-year low. Households also reported slight increases in job-market confidence and a small degree of comfort with non-essential spending. Still, consumers have shown less confidence in their ability to make ends meet as the year comes to a close.

Numerator’s data showed that 37% of consumers think it’s very or somewhat difficult to find employment in the current job market, up from last year. 

Consumer Confidence A Downward Trend This Year

When Trump decided to proceed with tariffs on several countries, concerns were raised, and Wall Street heeded the caution about a pullback in consumer spending.

The concerns appear to have come true as the year comes to a close and consumer confidence trends lower. The year saw price hikes as retailers and industrial giants raised prices to battle higher costs, now driven by tariffs on other countries.

According to Numerator, the consumer confidence score was 53.9 in November, flat compared to October and down from 56.2 in November 2024. The data showed that only 39% of consumers were very or somewhat comfortable spending money on discretionary purchases right now, down from last year. 

Consumer Spending Patterns

Over a third of consumers saved their spare cash in November or used it to pay down debts, Numerator said. The 34.5% figure for consumers who decided to put their money into savings was down 0.8% from October and 2.1% from last year.

The next most popular options that consumers chose, according to Numerator, were vacation and travel, home repair and improvement, and investing. Shoppers were willing to forgo purchasing apparel and electronics, and even spending on entertainment and meeting vacation needs, to repair their houses.

Consumers who are looking to save plan to shop on sale, use coupons & discount codes when possible, and cook at home. Over 21% are delaying the purchase of large items, and 22.3% are reducing or cancelling their subscriptions.

Financial Outlook For Next Year

Numerator noted that the financial outlook rebounded slightly in November after a sharp decrease in October, with shoppers feeling somewhat negative about their future finances. 

“Thinking about one year from now, more shoppers believe their finances will be worse (26%) than think they’ll be better (24%)—the first time this has occurred in two years,” Numerator said.

The data by Numerator combines details from three of its ongoing surveys and collects over 6,000 responses per month.

What Are Wall Street And Retailers Thinking?

JPMorgan in November noted that tariffs weighed on parts of the economy, with hiring slowing sharply and trade policy uncertainty spiking. In the same month, the Conference Board said that its consumer confidence index dropped to 88.7 from an upwardly revised 95.5 in October.

Major retailers, from Walmart to Best Buy, reported earnings in November that hinted that more American shoppers are seeking deals and discounts to snap up even essentials at the lowest possible price.

Best Buy CEO Corie Barry said on Tuesday that shoppers remained resilient but deal-focused and were attracted to more predictable sales moments during the third quarter.

Price increases were more pronounced as third-quarter results began to flow in. “Most companies have hit a ceiling with regard to taking more price increases; consumers have clearly been voting with their wallets that they are fatigued with high prices,” said Eric Clark, Portfolio Manager of LOGO ETF and Chief Investment Officer at Accuvest Global Advisors.

“Again, super high demand, high brand love, important spending categories have the best ability to take price, but they all know they run the risk of lowered volumes and traffic, so brands are being very conscious of price hikes now."

What Are Retail Traders Feeling?

The retail sentiment on Consumer Discretionary Select Sector SPDR Fund (XLY) jumped to ‘extremely bullish’ from ‘bearish’ territory a month ago, while sentiment on Consumer Staples Select Sector SPDR Fund (XLP) traded in the ‘bearish’ territory, compared to the ‘neutral’ observed a month ago.

Retail sentiment on Walmart was in the ‘bearish’ territory compared to ‘bullish’ territory from a week ago, while sentiment on Target was in the ‘bearish’ territory, down from the ‘neutral’ sentiment a week ago.

Best Buy’s retail sentiment was in the ‘neutral’ territory, compared to the ‘extremely bullish’ a week ago, while Amazon’s sentiment improved to ‘neutral’ territory from ‘bearish’ from seven days ago.

Walmart saw its stock jump almost 27% this year, Target shares are down 33% and Best Buy shares have declined 13%. Shares of Amazon have gained 6% year to date.

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Also See: Airline Retailing Is Taking Off — United’s Travelport Deal Aims To Rewrite How We Shop For Flights And How Carriers Make Money

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