U.S. Economic Confidence Index Stable at -14

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{rating}The FINANCIAL — Americans’ confidence in the U.S. economy has leveled off, with Gallup’s U.S. Economic Confidence Index averaging -14 for the week ending May 8. This score is similar to the -15 and -16 found the previous two weeks.

Index readings over the past three weeks have been on the lower end of the range of scores recorded so far in 2016, and all fall below the current 2016 average of -12. The -16 score for the week of April 18-24 represented a new low for the index this year; since then, the past two weeks’ -15 and -14 scores don’t reflect much improvement.

Americans’ confidence in the economy was a good deal higher one year ago when the weekly index registered -5. From a long-term perspective, the current index score is markedly higher than many scores recorded in Gallup’s trend since 2008.

Gallup’s U.S. Economic Confidence Index is the average of two components: how Americans rate current economic conditions and whether they feel the economy is improving or getting worse. The index has a theoretical maximum of +100 if all Americans say the economy is doing well and improving, and a theoretical minimum of -100 if all Americans say the economy is doing poorly and getting worse.

For the week ending May 8, the current conditions score matched the -5 from the previous week — the result of 25% of U.S. adults rating the current economy as “excellent” or “good,” and 30% rating it as “poor.” This component has not changed much over the past year, with Americans holding slightly negative views of the current state of the economy.

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The economic outlook score has varied more than the current conditions score over the past year, ranging from a low of -25 to a high of -9. The latest score of -23 is on the lower end of that range, the result of 36% of U.S. adults saying the economy is “getting better” and 59% saying it is “getting worse.”

Bottom Line

Americans’ evaluations of the economy remain moderately negative, with views of current conditions a bit less negative and more stable over the past year than views of the economy’s direction. While Americans enjoy relatively lower gas prices and see gradual progress in the stock market, they haven’t registered a positive view of the economy’s current state in over a year, and they have grown more pessimistic about its future in recent weeks.

 

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