American consumer confidence fell again in October, extending the deterioration seen in recent months. According to the preliminary estimate from the University of Michigan's "Surveys of Consumers," the consumer sentiment index dropped to 46,3 points, compared to 48,1 in September.

Compared to October 2025, when it stood at 53,6 points, the drop is 13,6%.

The indicator thus remains close to the lowest levels in the series, in a context marked by high prices, heavier financing costs and greater concern about purchasing power.

Current economic conditions fall to a historic low.

The deterioration was particularly pronounced in the assessment of the current situation. The Current Economic Conditions index fell from 50,9 points in September to 44,7 points in October, a monthly decrease of 12,2% and a year-on-year decrease of 23,7%.

According to Joanne Hsu, director of the study, conditions for purchasing durable goods have deteriorated sharply, primarily reflecting high prices and credit costs.

This point is particularly relevant for categories such as automobiles, furniture, home appliances, and electronics, where the postponement of purchases tends to increase when consumers feel less financially secure.

Expectations improve slightly, but remain weak.

Not all indicators declined. The consumer expectations index rose from 46,3 to 47,3 points, a monthly improvement of 2,2%.

Still, it remains 6% below the level recorded in October 2025, showing that the slight recovery does not alter the overall picture of weak confidence.

Expectations regarding personal finances and business conditions for the coming year have improved slightly, but remain constrained by the cost of living.

Expected inflation rises to 4,7%.

Concerns about prices have also increased again. Inflation expectations for the next 12 months rose from 4,6% to 4,7%, while long-term expectations increased from 3,4% to 3,5%. Both indicators rose for the second consecutive month and reached their highest levels since May.

One-year inflation expectations are also significantly higher than the 3,4% recorded in February, before the escalation of tensions in the Middle East.

Cost of living weighs more heavily on lower-income families.

The deterioration is not uniform across consumer groups. The University of Michigan highlights that confidence has fallen particularly sharply among lower-income households and consumers with smaller investment portfolios—precisely the groups with the least capacity to absorb price increases.

This difference reinforces a trend of polarization in consumption: families with greater wealth continue to show greater resilience, while consumers with less financial leeway reduce or postpone discretionary spending.

Durable goods among the most penalized.

Conditions for acquiring durable goods were one of the areas with the worst evolution in the survey. Rising prices and interest rates make higher-value purchases more difficult to justify, especially when financing is involved.

This dynamic can directly affect categories such as automobiles, home appliances, furniture, consumer electronics, and home equipment. For retailers in these areas, the pressure could translate into a greater need for promotions, financing, trade-in programs, and other tools that reduce the initial price barrier.

The job market is not the main source of concern.

Interestingly, the deterioration in confidence does not appear to stem primarily from fears about employment. Recent data from the Federal Reserve Bank of New York shows that expectations of unemployment and job loss have not worsened significantly, while confidence in the possibility of finding work has shown some improvement.

The main concern remains the price level and the perception that incomes are struggling to keep pace with the cost of living. This helps explain why consumers may maintain employment and income, but remain lacking in confidence.

Low confidence does not necessarily mean a proportional drop in sales. Historically, sentiment indices can deteriorate more rapidly than actual spending, especially when the labor market remains relatively solid.

In the United States, this contrast persists: consumers show strong frustration with prices, but aggregate spending remains sustained by higher-income groups. For retailers, this means that the risk lies less in a generalized halt in consumption and more in greater fragmentation across segments, categories, and income levels.

Christmas arrives with more cautious consumers.

The data gains added relevance with the start of the Christmas campaign. A study by Circana on purchasing intentions for 2026 shows that the average American consumer expects to spend $779, approximately €696, down from $796, approximately €711, recorded the previous year.

Furthermore, 74% plan to adopt savings strategies, including increased use of promotions and private label brands.

In other words, the breakdown in trust observed by the University of Michigan is consistent with a consumer who does not abandon consumption, but seeks to better control where and how they spend.

The energy context also continues to influence expectations. Worsening tensions in the Middle East have contributed to keeping energy prices high, fueling fears of renewed inflationary pressure.

This link between energy, inflation, and confidence is particularly important because fuel costs affect not only household budgets but also logistics, production, and distribution. A new wave of increases could therefore put pressure on both businesses and consumers simultaneously.

The data now released is preliminary. The University of Michigan is expected to publish the final results between October 23rd and October 24th, allowing researchers to see if the deterioration observed at the beginning of the month continues or if there has been any recovery over the following weeks.