Overall Consumer Confidence Improves, With A Spike In Confidence In The U.S. Economy
The Economic Sentiment Index increased slightly, according to the HPS-CivicScience Economic Sentiment Index (ESI), thanks to increased confidence in the broader U.S. economy. The index reading improved by a total of 0.5 points, from a reading of 52.8 points to 53.3 points. The renewed confidence in the U.S. economy offset declines in consumer faith in the housing market, making a major purchase, and personal finances.
After falling from February highs, consumer confidence has remained relatively consistent over the last two months, with an average reading of 52.9. During this time-period, the ESI has never exceeded 53.6 or fallen below 51.9 – a difference of 1.7 points.
The slight increase in the ESI was driven by increases in two of the ESI’s five indicators. Confidence in the broader economy increased by 3.7 points to a reading of 51.1, its highest level in over a month. Economic sentiment towards the U.S. housing market experienced the second largest move, offsetting gains in the broader economy. Confidence in the U.S. housing market fell 1.2 points to 48.4 during the reading period. While economic sentiment towards the U.S. labor market rose by 1.2 points, its highest reading since March 20th. Consumer confidence also fell across the other two indicators, with confidence in personal finances and making a major purchase declining by 0.7 and 0.4 points respectively.
Click here to view image.
The ESI’s three-day rolling average ended the two-week period on a slight increase. After rising to reach a reading of 55.2 on May 10th, the three-day rolling average fell consistently throughout the reading period. Between May 10th and May 15th the ESI dropped 2.5 points, largely erasing the gains made earlier in the reading period. On the final day, the three-week moving average jumped by 0.6 points to hit a reading of 52.7.
The first half of the ESI’s increase was reflected following the May 2nd announcement that the Federal Reserve would hold interest rates steady. This decision generated improved investor confidence, leading to an increase in the Dow Jones Industrial Average of 1.8 percent between May 2nd and May 4th. The decline in consumer confidence during the latter half of the reading period comes amid greater geopolitical tensions in the Middle East as President Trump announced the U.S. withdrawal from the Iran nuclear agreement on May 9th.
The next release of the ESI will be May 29, 2018.
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.
About Hamilton Place Strategies (HPS)
Hamilton Place Strategies (HPS) is an analytical public affairs consulting firm with offices in Washington, D.C. and San Francisco. 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.
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.