Consumer economic sentiment continued its recovery for a second straight reading as lawmakers passed a new COVID-19 relief bill and Americans enjoy a modified holiday season. The latest reading of the HPS-CivicScience Economic Sentiment Index (ESI) showed an increase of 1.2 points to 46.9, led by a 3.4-point jump in confidence in the broader economy.
Four of the five individual indicators improved during the two-week reading period. The largest increase was in confidence in the broader economy, whose 3.4-point jump represents the biggest improvement in the indicator since September 2020. Confidence in personal finances and the labor market also experienced a substantial increase, improving by 2.8 and 2.4 points, respectively. Confidence in the housing market also moved up by 1.7 points to reach 49.3. In contrast, on the heels of the holiday shopping season, confidence in making a major purchase dropped by 4.1 points—the largest drop in the indicator since the start of the pandemic in March.
The steady improvement in confidence over the past two weeks comes as Congress passed a long-awaited and much-debated $900B relief bill, and as health care workers, senior citizens, and others receive the initial wave of Moderna and Pfizer’s COVID-19 vaccines. Still, several areas of the U.S. are grappling with a post-Thanksgiving coronavirus surge and facing potential re-implementation of restrictions to minimize the spread. As the effects of the pandemic continue to hit pocketbooks, consumer spending by way of holiday shopping is expected to be weaker this year.
The ESI’s three-day moving average held relatively steady over the past two weeks, beginning at 45.6 before dropping to a low of 45.5 on December 14. The moving average peaked at 48.4 on December 18, and subsequently dropped back down to close out the reading at 46.3 on December 22.
The next release of the ESI will be on Wednesday, January 6, 2021.
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.
About Hamilton Place Strategies (HPS)
Hamilton Place Strategies (HPS) is an analytical public affairs consulting firm with offices in Washington, D.C. New York, and California. 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.
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.