The latest biweekly reading of the Penta-CivicScience Economic Sentiment Index (ESI) fell sharply by 1.4 points to 29.5, hitting its lowest point since the index began measuring public sentiment about the U.S. economy in 2013.
Four of the ESI's five indicators decreased during this period. Confidence in buying a new home decreased the most, falling 3.9 points to 23.6, marking this indicator's largest decline since September 2025.
—Confidence in making a major purchase decreased 1.7 points to 22.2.
—Confidence in finding a new job decreased 1.0 point to 23.4.
—Confidence in personal finances decreased 0.3 points to 49.6.
—Confidence in the overall U.S. economy increased 0.1 points to 28.9.
As the conflict in the Middle East stretches into a fourth week, Brent crude oil remained above $100 a barrel, signaling that markets still see meaningful risk to energy supply even after President Donald Trump said he's considering "winding down" U.S. involvement in the conflict. The conflict has led Iran to close the Strait of Hormuz, an important chokepoint that transits 20 percent of oil consumed globally. The significance of the strait's closure is spilling beyond oil prices and is feeding expectations of higher fuel, shipping, and fertilizer costs, which could add to inflation and complicate central banks' ability to cut interest rates.
The Federal Reserve held the federal-funds rate steady at a range of 3.5 to 3.75 percent, following an 11–1 vote at the March meeting of the Federal Open Markets Committee (FOMC). In its post-meeting statement, the FOMC noted that economic activity continues to expand at a solid pace, while inflation remains somewhat elevated and uncertainty about the economic outlook has increased. Officials specifically cited the conflict in the Middle East, stating that "the implications of developments in the Middle East for the U.S. economy are uncertain" and emphasizing that the Fed will continue to assess incoming data and evolving risks before making further policy adjustments.
Freddie Mac reported that the average 30-year fixed mortgage rate rose to 6.22 percent in the week ending March 19, 2026, its highest level in three months. The rise adds to already severe housing affordability pressures by increasing borrowing costs for buyers and raising input costs for builders, particularly through fuel-intensive construction materials. Analysts told The New York Times that the Middle East conflict is unlikely to immediately change major household purchase decisions, but a prolonged disruption could further delay a housing-market recovery that had been expected as rates gradually eased from their October 2023 peak.
Wholesale prices rose more than expected in February, with the Producer Price Index (PPI) increasing 0.7 percent on the month, above forecasts for a 0.3 percent gain, and rising 3.4 percent on a 12-month basis, the highest annual rate since February 2025. Core PPI, which excludes volatile food and energy prices, increased 0.5 percent monthly and 3.9 percent annually. The increase was driven in part by higher services costs, as well as gains in food and energy prices, indicating that pipeline inflation pressures remain persistent even before fully accounting for recent energy market disruptions tied to the conflict in the Middle East.
Commerce Department data showed that retail sales declined 0.2 percent in January to a seasonally adjusted $733.5 billion, following flat growth in December and extending a broader trend of soft consumer spending. While the decline was less severe than analysts had expected, the report reflects continued pressure on household spending amid elevated inflation and a cooling labor market. Underlying data were mixed, with stronger performance in some control group categories, but economists noted that consumer spending has outpaced income growth in recent months, raising concerns about the sustainability of demand.
The ESI's three-day moving average began this two-week stretch at 31.2 on March 11. It then fell to 29.8 on March 14 before rebounding briefly, peaking at 30.7 from March 15 to 16. The average then began to fall again, hitting a low of 28.3 on March 18 before rising again, closing out the session at 29.6 on March 24.
The next release of the ESI will be on Wednesday, April 8, 2026.