The FINANCIAL — Gallup’s U.S. Economic Confidence Index registered -9 for the week ending May 24, two points lower than the previous week. This reading remains lower than scores in the first four months of 2015, but is still much higher than what Gallup has found over most of the previous seven years.
The index has been in negative territory for all but one of the past 14 weekly readings. After consistent readings well below zero since the beginning of the recession, the index finally moved into positive territory in late December 2014 and remained there for nearly two months, coincident with the steep drop in gas prices. By mid-February, though, Americans’ economic confidence dropped into negative territory again and has averaged -4 ever since. Recent readings have dipped a bit further into the negative, including a -9 score three weeks ago.
Americans’ overall negative level of confidence in the nation’s economy for the week might be related to an increase in national gas prices over the holiday weekend. The trajectory of national gas prices could play a big part in the overall course of economic confidence as the year goes by; Gallup has previously noted a relationship between the two. Some oil price analysts suggest that gas prices will stabilize over the summer before dropping in the fall, according to Gallup.
Gallup’s Economic Confidence Index is the average of two components: Americans’ views of current economic conditions and their perceptions of whether the U.S. economy is getting better or getting worse. The theoretical maximum for the index is +100, if all Americans say the economy is excellent or good and getting better. The theoretical minimum is -100, if all Americans say the economy is poor and getting worse.
For the week ending May 24, 23% of Americans said the economy is excellent or good while 29% said it is poor, resulting in a current conditions score of -6. The economic outlook score of -11 is the result of 42% of Americans saying the economy is getting better and 53% saying it is getting worse.
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