US Consumer Confidence Rises Despite Soaring Gas Prices

Inflation expectations surge as Iran war impacts fuel costs

Mar. 31, 2026 at 7:21pm

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A vibrant abstract illustration composed of overlapping triangles and rectangles in shades of red, blue, and yellow, conveying a sense of economic resilience and consumer confidence.Consumers remain cautiously optimistic despite the economic headwinds of surging fuel costs.Washington Today

U.S. consumer confidence inched higher in March despite soaring energy prices brought on by the war in Iran, according to the Conference Board. While the topline confidence index rose modestly, measures of consumer expectations for inflation and the economy's future performance declined, raising concerns about the potential for a demand destruction shock as high gas prices hit consumers.

Why it matters

The consumer confidence data provides a key barometer of the U.S. economy's health and the public's sentiment as the country grapples with the fallout from the war in Iran, which has caused a spike in gas and energy prices. The report suggests Americans are growing increasingly pessimistic about the economic outlook, which could lead to reduced spending and a broader economic slowdown.

The details

The Conference Board's consumer confidence index rose to 91.8 in March from 91 in February, but respondents expressed growing concerns about rising inflation, with 12-month inflation expectations surging to levels last seen in 2025. U.S. gas prices jumped past an average of $4 per gallon for the first time since 2022 as the war caused fuel prices to soar worldwide. A measure of Americans' short-term expectations for their income, business conditions and the job market fell, remaining well below a marker that can signal a recession ahead.

  • The Conference Board released the March consumer confidence data on March 31, 2026.
  • U.S. gas prices reached an average of $4 per gallon on March 31, 2026.

The players

The Conference Board

A non-profit research organization that publishes widely watched economic indicators, including the consumer confidence index.

Heather Long

Chief economist at Navy Federal Credit Union, who provided analysis on the consumer confidence data and its implications.

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What they’re saying

“This is the key concern as the war in Iran enters the second month – will the oil price shock turn into a demand destruction shock?”

— Heather Long, Chief economist

What’s next

The Federal Reserve will closely monitor the consumer confidence data and inflation expectations as it considers whether to adjust interest rates in response to the economic impacts of the war in Iran.

The takeaway

The resilience of U.S. consumer confidence in the face of soaring gas prices is a positive sign, but the growing pessimism about the economic outlook and inflation expectations raises concerns about the potential for a broader demand slowdown if high energy costs persist.