The economy has been steadily growing for the last five years, and inflation is way down from its peak nearly four years ago. Public opinion about the economy, by contrast, keeps plumbing new depths.

The big picture: Americans are decisively negative about the economic picture, despite conventional measures of economic performance remaining reasonably solid.

• It suggests both a new political state of nature and an undercurrent of gloom that traditional economic data and analysis don't quite capture.

Catch up quick: As we noted Friday, a preliminary April reading from the University of Michigan consumer sentiment surveys was lower than that index has ever been, in data that has been consistently collected since 1978.

• That data was mostly collected before last week's ceasefire in the Iran war, so the final number may not be quite so bad — though the breakdown of U.S.-Iranian talks over the weekend is prompting a new surge in energy prices.
• Political polling points to the same underlying dynamics. A new CBS News poll shows that 63% rated the economy as "bad" and that 65% disapproved of President Trump's handling of the economy.

Reality check: The unemployment rate was a mere 4.3% in March. Inflation, even after the war-induced energy price surge, has been 3.3% over the past year.

• The S&P 500 is essentially flat for the year, and GDP continues rising at a steady clip.
• Yes, gasoline is more expensive, averaging $4.13 a gallon, up from under $3 in February. But it was more expensive than that at many points in the past, especially relative to wages.

Between the lines: People experience inflation not as a year-over-year percentage change, the way that economists often talk about it, but as a cumulative experience.

• Americans are still experiencing sticker shock at the price of groceries and other goods due to inflation that happened years ago.
• Moreover, the job market is by some measures weaker than the headline numbers suggest, with hiring rates low and job growth narrow — overwhelmingly driven by health care.
• Still, it raises the question of just how much further underwater public opinion could go if we get an actual recession, mass AI-driven job losses, or a bigger spike in energy prices.

Zoom in: Political polarization is also part of the story. More so than in the past, survey respondents' answers to questions about how they perceive the economy are dominated by their partisan leaning.

• In February 2009, for example, when the economy was in a deep recession and President Obama had just taken office, Democrats and Republicans shared similarly negative views of the economy — sentiment clocked in at 59.6 among Democrats and 55.1 among Republicans in the Michigan survey.
• That narrow partisan divide has become a chasm. In June 2022, at the peak of the Biden-era inflation, Democrats' sentiment was at 66.4 while Republicans were at 33.
• That gap is even wider today, with the partisan leanings inverted. Sentiment in the preliminary April reading was 31.8 among Democrats and 87.1 among Republicans.

Zoom out: The Trump administration faces the same dilemma that dragged down the Biden presidency: trying to boost confidence in the economy at a time when Americans' mood is deeply sour.

What they're saying: "Take it from me: Never try to tell the American people they're better off than they think they are," Jared Bernstein, President Biden's top White House economist, tells Axios.

• "And to emphasize what should be obvious, avoid doing things that make their lives more expensive, like tariffs and wars of choice," he adds.

Weak consumer confidence, scarce inventory and higher mortgage rates — that combination explains the slow start to the spring home-buying season.

By the numbers: Existing-home sales fell 3.6% last month, to a seasonally adjusted annual rate of 3.98 million — down 1% from a year ago, according to the National Association of Realtors.

• The median existing home price rose 1.4%, to $408,800, a new record for the month of March.

Between the lines: The monthly decline bucks a February gain that had raised hopes that more buyers were coming off the sidelines as mortgage rates slipped.

• Mortgage rates averaged 6.2% in March, up from 6% the prior month.

What they're saying: "March home sales remained sluggish and below last year's pace," NAR chief economist Lawrence Yun said in a release. "Lower consumer confidence and softer job growth continue to hold back buyers."

• NAR said that an additional 300,000 to 500,000 homes for sale would bring the housing market "closer to normal conditions" that would help keep a lid on prices.
• Strong price growth, however, means the typical homeowner has accumulated about $128,000 in housing wealth since 2020, NAR said.

What to watch: NAR trimmed its 2026 home sales forecast. The group expects new-home sales to be flat this year, down from a prior projection of a 5% gain.

• "Mortgage rates have been rising, and that has led us to trim our home sales outlook for the year. ... Even with a more modest pace of sales growth, home prices continue to steadily increase due to minimal inventory growth," Yun said.