Consumers are starting to feel the economic recovery, as the Gallup index of U.S. Economic Confidence tipped into positive territory for the first time since 2007.
American consumer confidence is starting to reflect the idea that the economic recovery is picking up speed. That view was reflected by Gallup’s Index of U.S. Economic Confidence inching into positive territory for the first time since the Great Recession started in 2007. The index averaged +2 for the week ending Dec. 28.
The Index is the average of two components: Americans’ views of current economic conditions and their perceptions of whether the economy is getting better or worse. The index has a maximum of +100 if every American rated current conditions as excellent or good and saw the economy as getting better. By contrast, the index also has a minimum of -100 if all Americans viewed current conditions as poor and thought the economy was getting worse.
Positive scores indicate Americans, on balance, view the economy positively, and negative scores indicate they view the economy negatively. Last week’s average of +2 is the first time the index has escaped negative territory since the recession.
The index’s rolling three-day average for Dec. 22-28 ranged from +2 to +4. While the time frame includes the usually busy time leading up to Christmas, this is the first year since 2007 that there has been a consistent pattern of increasing economic confidence.
The index’s climb began in mid-September which coincided with a precipitous fall in gas prices. The recent increases in the stock market and falling unemployment rate have been additional factors leading to the uptick.
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