Consumer Confidence In The U.S. Economy Falls As Trade Tensions Escalate
Consumer confidence in the U.S. economy fell by 4.7 points, the largest drop this year, according to the HPS-Civic Science Economic Sentiment Index (ESI). Overall consumer confidence fell by 1.0 point to reach a reading of 52.4. After rising steadily in January to hit a peak reading 55.6 at the beginning of February, the ESI has declined steadily, falling 3.2 points. Despite the general drop in consumer confidence this year, economic sentiment remains slightly above last year’s levels.
The large decline in confidence in the U.S. economy comes amid escalating trade tensions between the U.S. and Canada. Following President Trump’s imposition of tariffs on Canada and Europe on May 31st, Canada announced retaliatory tariffs on June 9th. On the same day, the ESI’s three-day moving average hit its lowest level with a reading of 51.6.
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Three of the ESI’s five indicators fell during the two-week reading period. Confidence in the broader economy experienced the largest drop, falling 4.7 points, from 52.7 points to 48.0 points. Economic sentiment towards the U.S. housing market also declined by 1.7 points from a reading of 48.8 to 47.1. At the same time, consumer confidence in their personal finances increased slightly from 65.0 points to 66.4 points, an increase of 1.4 points.
Economic sentiment towards making a major purchase also declined, dropping from 53.5 points to 53.1 points. Meanwhile, confidence in the U.S. labor market remained flat, moving up by 0.1 points.
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The ESI’s three-day rolling average was relatively volatile during the reading period. After falling during the beginning of the reading period the moving average recovered between June 4th and 7th. After peaking on June 7th, however, the rolling average fell to a low point of 51.0 points on June 11th before recovering slightly on June 12th.
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The next release of the ESI will be June 26, 2018.
About the Index
The HPS-CivicScience Economic Sentiment Index (“ESI”) is a “living” index that measures U.S. adults’ expectations for the economy going forward, as well as their feelings about current conditions for major purchases. The primary goal of the Index is to accurately measure movements in overall national economic sentiment, and to provide a more sophisticated alternative to existing economic sentiment indices. Unlike other prominent indices that release consumer sentiment estimates infrequently, the HPS-CivicScience Index is updated in real time as responses are collected continuously every hour, every day. Large-scale cross-tabulation of survey responses and consumer attributes enable more granular analyses than are currently possible through prevailing measures.
For a more detailed overview of the Index and the underlying methodology, please request a white paper.
About Hamilton Place Strategies (HPS)
Hamilton Place Strategies (HPS) is an analytical public affairs consulting firm with offices in Washington, D.C. and San Francisco. We integrate substantive analysis with communications and believe a deep understanding of business and economics leads to more effective public engagement and better outcomes for our clients.
For more information, visit Hamilton Place Strategies by clicking here and follow them on Twitter – @HPSInsight.
About CivicScience
CivicScience, Inc. provides the leading intelligent polling and real-time consumer insights platform, the InsightStore™. Its proprietary platform powers the world’s opinions and quickly gets that data to the decision makers who care. Every day, CivicScience polls ask millions of people questions related to thousands of topics, while its powerful data science and big data technology analyzes current consumer opinions, discovers trends as they start, and accurately predicts future behaviors and market outcomes. CivicScience polls run on hundreds of premier websites, in addition to its own public polling site at www.civicscience.com. CivicScience’s InsightStore™ is used by leading enterprises in marketing research, advertising, media, financial services, and political polling. For more information, visit CivicScience by clicking here and follow them on Twitter – @CivicScience.