Diverging US economic data raises question of a slowdown

US economic data are diverging wildly, fueling a debate over whether rising anxiety from President Donald Trump's trade policies will push a moderating economy into a serious downturn.

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NEW YORK -

Surveys of sentiment among households and businesses, known as "soft data," are warning of a marked slowdown ahead as Mr. Trump pushes forward with tariffs and steep cuts to federal spending. But "hard data" from government statistics, like employment and manufacturing, suggests those fears — potentially including stagflation or even recession — are overblown.

The mixed signals are causing jitters across Washington and Wall Street on what lies ahead for the world's largest economy — which, in a matter of weeks, has shifted from global outperformer to the top source of uncertainty. Federal Reserve officials lowered their forecast for annual growth last week by the most since 2022, while the Organisation for Economic Cooperation and Development says US trade policy will slow economic activity around the world.

Much of the anxiety can be traced to surveys of consumer attitudes from the University of Michigan and The Conference Board, which have both cited concerns that tariffs will lead to higher prices. Executives from Nike to Delta Air Lines have noted the trend, contributing to a multitrillion-dollar wipe-out in stocks in the past month.