US May Consumer Confidence Index Rebounds… "US-China Tariff Truce Drives Sentiment Recovery"

It has been observed that the economic outlook of US consumers has significantly improved. The easing of tariff tensions between the US and China is analyzed to have led to a rebound in consumer sentiment, which had been on a downward trend.

The Conference Board, a US economic research organization, announced on the 27th (local time) that the Consumer Confidence Index for May (based on 1985=100) was recorded at 98.0. This is an increase of 12.3 points from the previous month (85.7), significantly exceeding the market forecast (86.0 based on Dow Jones data).

The Conference Board explained, "The agreement between the US and China on a 90-day grace period for tariff policies on May 12 positively changed consumers' economic outlook." It is evaluated that the trade friction between the two countries has entered a pause, somewhat alleviating the uncertainty about the future economic flow.

This rebound is particularly noteworthy as it reverses the downward trend in the Consumer Confidence Index that had continued for the past five months. Previously, US consumers had reacted sensitively to the successive tariff increases by the Donald Trump administration and concerns about a global economic slowdown, pulling down the confidence index.

Experts evaluate that this rebound gives a positive signal for short-term sentiment recovery, but caution is also raised about whether the recovery in consumer sentiment will continue, as the trade negotiations have not been finally concluded.

Reporter Hyein Lee hey@hankyung.com