Economic Sentiment Defies Expectation, Sees First Rebound Since Early June
Economic sentiment rebounded over the past two weeks, as the U.S. reported the smallest daily rise in COVID-19 infections in weeks, and hopes for a potential vaccine increased. The HPS-CivicScience Economic Sentiment Index (ESI) posted a positive gain for the first time since early June, jumping 3.1 points to 47.1. All five of the ESI’s indicators increased, with confidence in personal finances leading the uptick.
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All five of the ESI’s indicators rose over the past two weeks. Confidence in personal finances rose the most, gaining 4.0 points to close at 54.4. Close behind were gains in confidence in the U.S. economy and confidence in making a major purchase, which rose 3.7 and 3.6 points, respectively, and both closed out the two-week period at 45.9. Posting more modest gains were confidence in finding a new job (up 2.5 points to 34.0) and confidence in the housing market (up 1.8 points to 55.2).
The uptick in sentiment comes amid mixed economic news. Cases of COVID-19 are rising at their slowest rate in weeks, while several potential vaccines entered new trial phases. Yet the $600-per-week unemployment benefit, implemented as part of the CARES Act in late March, expired July 31 after Congressional Republicans and Democrats were unable to come to an agreement on another round of fiscal stimulus. Initial unemployment claims rose for a second straight week at the end of July, moving up from 12,000 to 1.43 million. Additionally, forecasts predicting a sharp rise in economic activity in Q3 are largely dependent on rates of infection not rising.
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The ESI’s three-day moving average began the two-week stretch at 45.3 on July 22, before rising to its peak of 49.5 on July 24. It then declined before reaching its two-week low of 44.1 on July 29. The moving average rebounded on August 1 before falling again and closing out the two-week stretch at 46.8.
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The next release of the ESI will be on Wednesday, August 19, 2020.
About the Index
The HPS-CivicScience Economic Sentiment Index (“ESI”) is a “living” index that measures U.S. adults’ expectations for the economy going forward, as well as their feelings about current conditions for major purchases. The primary goal of the Index is to accurately measure movements in overall national economic sentiment, and to provide a more sophisticated alternative to existing economic sentiment indices. Unlike other prominent indices that release consumer sentiment estimates infrequently, the HPS-CivicScience Index is updated in real time as responses are collected continuously every hour, every day. Large-scale cross-tabulation of survey responses and consumer attributes enable more granular analyses than are currently possible through prevailing measures.
For a more detailed overview of the Index and the underlying methodology, please request a white paper, and follow us on Twitter – @HPS_CS.
About Hamilton Place Strategies (HPS)
Hamilton Place Strategies (HPS) is an analytical public affairs consulting firm with offices in Washington, D.C. New York, and California. We integrate substantive analysis with communications and believe a deep understanding of business and economics leads to more effective public engagement and better outcomes for our clients.
For more information, visit Hamilton Place Strategies by clicking here and follow them on Twitter – @HPSInsight.
About CivicScience
CivicScience, Inc. provides the leading intelligent polling and real-time consumer insights platform, the InsightStore™. Its proprietary platform powers the world’s opinions and quickly gets that data to the decision makers who care. Every day, CivicScience polls ask millions of people questions related to thousands of topics, while its powerful data science and big data technology analyzes current consumer opinions, discovers trends as they start, and accurately predicts future behaviors and market outcomes. CivicScience polls run on hundreds of premier websites, in addition to its own public polling site at www.civicscience.com. CivicScience’s InsightStore™ is used by leading enterprises in marketing research, advertising, media, financial services, and political polling. For more information, visit CivicScience by clicking here and follow them on Twitter – @CivicScience.