Republicans are becoming significantly less confident about the U.S. economy, according to new consumer sentiment data that could put additional attention on President Donald Trump’s economic agenda heading into the 2026 midterm elections.
The change is particularly notable because Republicans remain much more optimistic about economic conditions than Democrats. What has changed dramatically is the level of that optimism.
Republican consumer sentiment has fallen 15.1 points since February, dropping from 97.1 to 82, according to University of Michigan Surveys of Consumers data reported by Axios.
During the same period, sentiment among Democrats slipped only 1.6 points, moving from 41.8 to 40.2.
The Republican reading is now lower than at nearly any other point during Trump’s time in the White House, with December 2020 being the exception.
For an administration that has made economic growth, trade, energy and domestic investment central parts of its agenda, the numbers highlight a growing challenge: convincing Americans that broader economic policies are improving their own household finances.
Republican Economic Confidence Drops
Joanne Hsu, director of the University of Michigan’s Surveys of Consumers, told Axios that Republicans and Democrats generally move in the same direction when their economic confidence changes.
That pattern has broken down recently.
Republicans began the year with high expectations that Trump’s economic policies would deliver noticeable improvements. Those policies include tax cuts, deregulation, tariffs, expanded energy production and efforts to attract enormous amounts of private investment into the United States.
But Americans do not experience the economy solely through economic reports or investment announcements.
They experience it when they buy groceries, fill their vehicles with gasoline, pay electricity bills and balance their monthly budgets.
Those everyday expenses remain a major concern.
Inflation Continues To Hit Household Budgets
Consumer prices were 3.4% higher in July than they were one year earlier, according to the Bureau of Labor Statistics.
Food prices increased 3% over the year, while food purchased for consumption at home — commonly referred to as groceries — increased 2.7%.
Electricity costs were 4.2% higher.
Gasoline presented an even bigger problem for drivers, rising 24.6% from a year earlier.
There was better news when looking at the shorter-term trend. Overall consumer prices increased only 0.1% between June and July, while gasoline prices declined during the month.
That distinction matters.
A slowdown in inflation does not necessarily mean prices are returning to their previous levels. It generally means prices are increasing more slowly.
For households that have already absorbed years of higher costs, that can make improvements in inflation statistics feel very different from improvements in their checking accounts.
Another Inflation Measure Remains Elevated
The Federal Reserve’s closely watched Personal Consumption Expenditures price index also shows continued inflation pressure.
The PCE price index was 3.7% higher in July compared with the same month one year earlier.
The University of Michigan’s research provides another indication of how consumers view their purchasing power.
Only a small share of consumers surveyed expect their incomes to grow faster than inflation during the coming year.
That gap between income expectations and anticipated expenses can have an enormous effect on consumer confidence.
For older Americans and retirees, the issue can be especially noticeable because recurring expenses such as food, utilities, insurance, transportation and housing consume substantial portions of monthly household budgets.
Trump’s Economic Agenda Focuses On Longer-Term Growth
The Trump administration has argued that its policies are laying the foundation for stronger economic growth.
The White House has emphasized tax cuts, deregulation, trade agreements and major private-sector investments as evidence that its economic program is working.
Artificial intelligence and data centers have become another major component of that strategy.
Supporters of these investments argue that new infrastructure could create jobs, increase productivity and strengthen America’s position in the rapidly expanding artificial intelligence industry.
But there is an important difference between long-term investment and immediate household finances.
A multibillion-dollar project may contribute to future economic growth without immediately reducing the amount a family pays for hamburger meat, electricity or gasoline.
That timing problem appears to be increasingly important to consumers.
Energy Prices Add Another Complication
Energy has become another major economic concern amid the ongoing conflict involving Iran.
Higher gasoline prices are particularly visible because Americans encounter them constantly.
Unlike many economic indicators buried inside government reports, drivers can watch gasoline prices change on signs throughout their communities.
The University of Michigan research indicates that Republicans generally expect gasoline prices to decline once the conflict ends.
However, uncertainty surrounding the conflict has also contributed to expectations of higher fuel prices over both the short and longer term.
The Trump administration has pursued policies intended to expand energy supplies and ultimately reduce costs, but consumers are still waiting to see how those initiatives translate into prices at their local gas stations.
The Economy Still Has Signs Of Strength
The latest numbers are not universally negative.
There are important signs that American households continue to show resilience.
Disposable personal income increased 0.5% in July, according to the Bureau of Economic Analysis.
After accounting for inflation, real disposable personal income increased 0.4%.
Consumer spending increased 0.2%.
Those figures suggest Americans continue to spend despite concerns about prices and the broader economy.
The White House argues that the numbers demonstrate underlying economic strength.
White House spokesman Kush Desai pointed to consumer spending and retail sales while defending the administration’s economic record, saying Trump’s tax cuts and deregulation have helped support American consumers.
The administration also argues that the full impact of its economic policies, trade agreements and major investment commitments will become increasingly visible with time.
Why Consumer Confidence Matters
Consumer sentiment isn’t the same thing as presidential approval.
That’s an important distinction.
The University of Michigan survey measures how people view economic conditions and their personal financial prospects. It does not establish how respondents intend to vote.
The new numbers therefore should not be interpreted as showing that Republicans are abandoning Trump.
In fact, Republican economic sentiment remains substantially higher than Democratic sentiment.
The noteworthy development is the size and speed of the decline among Republicans.
A fall from 97.1 to 82 in roughly six months indicates that some of the economic optimism seen among Republicans earlier this year has faded.
The Midterm Question Facing Republicans
With the November midterm elections approaching, economic conditions are receiving increasing attention.
Trump and congressional Republicans can point to rising disposable income, continued consumer spending, major domestic investments and an economic agenda they argue will produce stronger growth over time.
At the same time, Americans continue dealing with elevated prices for many everyday necessities.
That creates two different economic stories.
One focuses on investment, economic growth and what current policies could produce in the future.
The other focuses on what Americans are paying today.
For voters balancing grocery bills, utility payments, gasoline expenses, mortgages and other household costs, the second can be much easier to see.
Republicans are still considerably more confident about the economy than Democrats, meaning the latest numbers do not represent a wholesale collapse in GOP economic optimism.
But the unusually steep decline among Republicans shows that some of Trump’s own political base has become less upbeat about economic conditions.
With the midterms drawing closer, one of the biggest questions surrounding the administration’s economic agenda is whether Americans will begin seeing more noticeable improvements in their everyday finances.
For many households, that could ultimately matter more than any economic statistic coming out of Washington.