The FINANCIAL — Gallup’s U.S. Economic Confidence Index averaged -14 for the week ending Sept. 6. This is up slightly from the 11-month low of -17 found the weekprior, but remains on the lower end of scores found in 2015.
Gallup’s Economic Confidence Index began the year in positive territory for the first time since the recession. This continued the trend of increasing confidence that began in late 2014, following a steady decline in gas prices. As gas prices began to rise in late February, Americans’ confidence in the economy started to fall.
The index remained above -10 until July. It has stayed below that level since — including a -17 score for the week ending Aug. 30, when doubts about China’s economy made the U.S. stock market fall sharply.
Gallup’s Economic Confidence Index is based on the combined responses to two questions, the first asking Americans to rate economic conditions in this country today, and the second asking whether they think economic conditions in the country as a whole are getting better or getting worse. The index has a theoretical maximum of +100, if all Americans were to rate the economy as “excellent” or “good” and “getting better,” and a theoretical minimum of -100, if all Americans were to rate the economy as “poor” and “getting worse.”
Americans’ Economic Outlook Improves
The economic outlook score increased slightly to -20 from -25 the week prior. This week’s score is the result of 38% of Americans saying the economy is getting better and 58% saying it is getting worse.
The current conditions score registered -8, on par with scores measured the past few weeks. This is based on 23% of Americans rating the economy as excellent or good, and 31% rating it as poor. Since March, Americans’ views of current economic conditions have been more positive than their economic outlook.
Bottom Line
Gallup’s Economic Confidence Index has ranged from -11 to -17 since early July, the lowest scores recorded since October 2014. While the volatile U.S. stock market has dropped significantly since July, the broad downturn in economic confidence began much earlier this year. The index fell back into negative territory in late February, and therefore does not appear to be a direct result of stock market shifts.
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