The Iran conflict has modestly chilled California’s consumer confidence, leaving this measure of optimism below its historical norm and its level before Donald Trump was elected president.

My trusty spreadsheet found the Conference Board’s Consumer Confidence Index for the state ran 1.6% lower in February through April than in the previous three months. After Middle East tensions rose throughout February, the U.S. and Israel attacked Iran on the night of Feb. 28.

Not only is any war unsettling, but a key consumer expense – gasoline prices – skyrocketed due to the ensuing disruptions to the world’s oil markets. That boosted fears that the costs of other consumer goods could soon follow.

Also, hopes for much cheaper mortgages also dimmed as the war broke out.

Contemplate that the recent drop in the confidence index, based on public surveys, leaves the California index 6% below its long-term average dating to 2007. The index has also fallen 18% since August-October 2024, just before Trump won his second term in the White House.

Not only are Trump’s “American First” economic policies a sharp contrast to California’s more global business thinking, but the state also has its own challenges that can unnerve shoppers – notably its troublesome high cost of living.

Plus, the state will have a new governor come 2027, adding another slice of uncertainty for California consumers.

Ponder two slices of the California index to see where anxieties reside.

The “present situation” index, which tracks financial conditions, is somewhat upbeat. Yes, its fell 2% over the last three months, but it’s at a level that’s surprisingly 5% above average. Still, it’s down 13% since Trump’s election.

But Californians’ outlook is cloudy. The forward-looking “expectations” index is off 1.2% over the last three months to a level 14% below average. It’s also 21% below pre-election optimism.

Remember, consumer spending is a huge part of the overall economy. So, if this kind of skittishness translates to less shopping, the business climate can quickly sour.

Average Americans

U.S. consumers are relatively more upbeat.

The nation’s consumer confidence has been essentially flat for the last three months and sits at its 19-year average. However, this optimism benchmark has dipped 12% since the presidential election.

Americans’ view of the present situation is off 1% the last three months, yet remains 15% above average. It’s down 7% vs. pre-election levels.

U.S. expectations rose 2% the last three months but are still 13% below average and down 17% since Election Day.

Stately divide

The seven other states tracked by the Conference Board have mixed emotions in this wartime era.

Confidence slipped in four states recently.

– Illinois: Confidence dipped 7% last three months but 5% above average, yet down 14% vs. pre-election.

– New York: Confidence dipped 3% last three months but 21% above average, yet down 4% vs. pre-election.

– Pennsylvania: Confidence dipped 3% last three months. Its 2% above average and down 1% vs. pre-election.

– Texas: Confidence dipped 0.03% last three months to 4% below average and down 4% vs. pre-election.

In three states, however, there’s more optimistic thinking.

– Florida: Confidence is up 9% last three months to 19% above average and up 5% vs. pre-election.

– Ohio: Confidence up 6% last three months to 8% above average but down 12% vs. pre-election.

– Michigan: Confidence up 3% last three months to 5% above average but down 14% vs. pre-election.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

Try Jonathan Lansner’s Substack collection of economic trends. CLICK HERE!