- U.S. Economic Confidence Index drops to average of -2
- Both subcomponents fell to -2
- Confidence remains higher than in February 2014
WASHINGTON, D.C. -- Gallup's U.S. Economic Confidence Index fell to an average of -2 for the week ending Feb. 22. This is the first time the index has had a negative weekly average since late December. Prior to that, the index had consistently been in negative territory since Gallup began tracking it daily in 2008.
The Economic Confidence Index fell five points from the week prior, the largest drop since July. The weekly index numbers are usually fairly stable, not changing more than a couple of points unless there is some significant event. It is not clear what is behind last week's decline in confidence, although quickly rising gas prices last week may have played a role -- given that the drop in gas prices coincided with the rise in confidence in late 2014. The index had more or less leveled off in early 2015 before this decline.
Gallup's Economic Confidence Index is the average of two components: how Americans rate current economic conditions and whether they say the economy is getting better or getting worse. Last week, both components dropped from the prior week, falling into negative territory.
For the week ending Feb. 22, 27% of Americans said the economy was "excellent" or "good," while 29% said it was "poor." This resulted in a current conditions score of -2, compared with +2 the week prior. Meanwhile, the economic outlook score also was -2, the result of 47% of Americans saying the economy is "getting better" while 49% said it is "getting worse." The economic outlook score is down from +3 the previous week.
Americans' lower confidence in the economy last week is most likely a reaction to the rise in gas prices. Even though gas prices remain well below where they were a year ago, the recent increase has been fairly sharp -- though perhaps less than the normal late winter increase -- and the shift from declining to rising prices may simply be discouraging to consumers. News of labor slowdowns in California ports in response to labor disputes with dockworkers may also have been a concern.
Last year, harsh winter weather harmed the economy as distribution of supplies was delayed and people were unwilling to venture into the cold to go shopping, resulting in a drop in GDP in the first quarter of 2014. While it is too early to tell if this year's weather is also negatively affecting the economy, severe cold weather swept through the Midwest and the Southern U.S. last week, while New England continues to receive record snowfall. Still, economic confidence remains stronger than it has been over the past few years, despite the drop last week. However, if gas prices continue to rise and the weather ends up adversely affecting first quarter economic growth, economic confidence could struggle to get back into positive territory.
Results for this Gallup poll are based on telephone interviews conducted Feb. 16-22, 2015, on the Gallup U.S. Daily survey, with a random sample of 3,535 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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