Economic sentiment extended a three-week advance in this week’s Consumer Comfort survey, with Americans’ present-day ratings of their personal finances and the buying climate driving a recovery from steep losses in September and October.
Separately, though, expectations for the national economy’s future are negative for a third consecutive month, a pivot from optimistic views in spring and early summer as inflation has intensified.
The current-sentiment CCI is up 2.8 points in three weeks after a 10.3-point drop from late August to late October, its second-largest eight-week drop on record in weekly polls since late 1985. At 50.7 on its 0-100 scale, the index remains 7.5 points short of its pandemic peak in late August.
The CCI’s subindex based on assessments of personal finances gained a non-significant 0.9 points this week for a cumulative 5.4-point gain in three weeks to a six-week high of 66.3. That erases more than half its losses from late August to late October, placing it just 4.7 points from its 18-month high Aug. 22 and 4.9 points off its record high in January 2020.
Ratings of whether or not it’s a good time to buy things are up 3.2 points in three weeks to a subindex score of 43.2. That’s about a third of the way back from its 9.9-point drop from mid-September to late October, leaving this gauge still 7.5 points short of its pandemic-era peak in late June.
The CCI’s third gauge, based on ratings of the national economy, has held within a non-significant 0.7-point band for four weeks, steady since falling 12.1 points from late August to late October. At 42.6, the subindex remains a distant 12.2 points from its pandemic high in late August.
In the latest monthly expectations result, 38 percent say the economy is getting worse vs. 27 percent who think it’s improving. The rest, 36 percent, say it’s staying about the same. That -11-point better-worse margin is essentially unchanged since September, compared with positive +2- to +6-point margins from April to August. Outlooks nonetheless are better than their levels earlier in the pandemic, and compare with an historical average of -17 points in data since March 1986.
The Consumer Comfort survey measures views of current economic conditions with expectations for the future separately, because the two are different in nature and can point in different directions. This differs from other consumer surveys, which combine the two measures.