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U.S. Economic Confidence Index Still Positive, but Barely
Economy

U.S. Economic Confidence Index Still Positive, but Barely

U.S. Economic Confidence Index Still Positive, but Barely

Story Highlights

  • Fourth consecutive positive weekly index reading, at +2
  • Two-point dip from previous week

WASHINGTON, D.C. -- Gallup's U.S. Economic Confidence Index averaged +2 for the week ending Jan. 18, its fourth consecutive positive score. However, the latest score is a two-point dip from the previous week, and perilously near the negative territory it was in for the past seven years.

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Americans' confidence in the economy only turned positive recently, when it reached +2 at the end of 2014. Since then, it has reached as high as +4. Although the recent positive figures are good news after seven years of sustained economic negativity, they are mere points away from reverting back below zero.

The fragility of Americans' overall positive economic outlook is underscored by the volatility in Gallup's three-day rolling averages throughout the past week. Although the weekly average ended in positive territory, the index fell back into negative territory during the middle of the week -- perhaps related to news reports of disappointing retail sales in December -- before recovering later in the week.

Gallup's Economic Confidence Index is based on Americans' assessments of current U.S. economic conditions and their perceptions of whether the economy is getting better or worse. It has a theoretical minimum of -100, if all Americans thought the economy was poor and getting worse, and a theoretical maximum of +100, if all Americans thought the economy was excellent or good and getting better.

For the week ending Jan. 18, 26% of Americans said the economy was "excellent" or "good," while 27% said it was "poor," resulting in a current conditions index score of -1 -- a four-point dip from the previous week. Meanwhile, 50% of Americans said the economy was "getting better" while 46% said it was "getting worse," resulting in an economic outlook score of +4. This is down one point from the week prior. Americans' assessments of current economic conditions changed more last week than their views of the economy's future course.

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Bottom Line

From a larger perspective, the three weekly Economic Confidence Index scores in 2015 so far have been good when compared with previous years of seriously low confidence Americans had in their national economy. However, three-day rolling averages are more revealing of how close the index is to dropping below zero again.

Despite promising news for Americans' overall outlook -- improved assessments of Americans' personal finances, new highs in standard of living -- the index is still vulnerable to seeing its recent progress wither if the stock market declines, or if economic forecasts do not consistently paint a picture of an improving economy.

Survey Methods

Results for this Gallup poll are based on telephone interviews conducted Jan. 12-18, 2014, on the Gallup U.S. Daily survey, with a random sample of 3,545 adults, aged 18 and older, living in all 50 U.S. states and the District of Columbia. For results based on the total sample of national adults, the margin of sampling error is ±2 percentage points at the 95% confidence level. All reported margins of sampling error include computed design effects for weighting.

Each sample of national adults includes a minimum quota of 50% cellphone respondents and 50% landline respondents, with additional minimum quotas by time zone within region. Landline and cellular telephone numbers are selected using random-digit-dial methods.

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Gallup https://news.gallup.com/poll/181193/economic-confidence-index-positive-barely.aspx
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