Americans Are Bracing for a Trump-Engineered Recession, Higher Inflation
April 25, 2025
Americans Are Bracing for a Trump-Engineered Recession, Higher Inflation
Consumer Sentiment Falls for Fourth Straight Month; Year-Ahead Inflation Expectations Highest since 1981
”Why Trump’s Tariffs Could Put America in a Uniquely Brutal Recession” – Lindsay Owens
As President Trump’s approval rating on the economy plunges to new lows and Americans brace themselves for a Trump-manufactured recession, final data from the April University of Michigan Consumer Sentiment Survey showed that consumer sentiment fell for the fourth straight month. Year-ahead inflation expectations surged from 5.0% last month to 6.5% this month, the highest reading since 1981 and marking four consecutive months of major increases.
Groundwork Collaborative Chief of Policy and Advocacy Alex Jacquez reacted with the following statement:
“We are less than 100 days into the second Trump administration, and the American people have had enough. While consumer sentiment is on the skids, polling shows that for the first time in a quarter-century, a majority of Americans see their financial situation getting worse, not better.
“Trump’s economic mismanagement has sent business uncertainty skyrocketing, pummeled supply chains, and will supercharge the affordability crisis. Trump is engineering a recession of his own making, and it’s working families who will suffer most.”
Email press@groundworkcollaborative.org to speak with a Groundwork expert about President Trump’s handling of the economy.
THIS WEEK IN THE TRUMP SLUMP
Economic Data and Analysis
- Consumer sentiment data from the University of Michigan survey showed that economic expectations have fallen 32% since January, the steepest three-month percentage decline seen since the 1990 recession.
- The Federal Reserve Bank of Atlanta’s gold-adjusted GDPNow tracker projects that the economy will shrink by 0.4% in the first quarter of this year.
- Existing home sales fell nearly 6% in March, falling even further than expected. Home sales are at their slowest pace since 2009.
- The S&P Global US PMI Composite Output Index fell from 53.5 in March to 51.2 in April, below expectations of 52.8. The fall in the index signals a deceleration of activity growth to a 16-month low.
- The term “recession” was mentioned on 44% of earnings calls in the first quarter of this year. Only 3% of earnings calls mentioned “recession” in the last quarter of 2024.
Polling
- A Gallup poll this week showed that for the first time in at least 25 years, a majority of Americans (53%) said their personal financial situation was getting worse. This is higher than the Great Recession, the pandemic, and when inflation peaked in the summer of 2022.
- Polling from Reuters/Ipsos found that just 37% of people approve of the president’s handling of the economy.
- Quinnipiac found that 55% of people disapprove of Trump’s economic stewardship. 72% of respondents also believe that Trump’s tariffs will hurt the economy in the short term, and 53% think it will hurt it in the long term.
- An Economist/YouGov poll found that 53% of people disapprove of the president’s handling of “jobs and the economy.”
- Polling from Fox News shows that a majority of Americans disapprove of President Trump’s handling of the economy, inflation, taxes, and trade, with less than 40% of people approving of his work on any of the four issues.
Expert Commentary
- In an op-ed for Rolling Stone, Groundwork Collaborative Executive Director Lindsay Owens argued that a Trump-induced recession would be uniquely devastating due to the possibility of stagflation and DOGE’s dismantling of key federal agencies. As Owens wrote, “Recessions can take on a life of their own, spiralling downward more quickly than you expect — and as he’s showing us, Trump is not a skilled manager of the economy.”
- Mark Zandi of Moody’s Analytics noted in a tweet, “The Trump administration’s policies are set to severely diminish the economy, not only for the next few months but for years.”
- Torsten Slok, chief economist at Apollo Global Management, is certain the U.S. will fall into a recession this year if tariffs stay where they are. “It’s all conditioned on tariffs staying in place at these levels, and if they stay at these levels, we will absolutely have a recession in 2025.”
- In a recent interview with NBC’s Meet the Press, Ray Dalio, the founder of Bridgewater Associates, warned of a “breaking down of the monetary order” and “profound changes in the world order,” if current financial, economic, and trade challenges are not effectively managed by the administration.
- Neil Dutta, head of economics at Renaissance Macro Research, told CNBC, “I think we’re jumping into recession. You never just glide in. We’re going into it right now.” He also noted that economic data right now is a mirage masking the slowdown.
