Economic Sentiment Declines As The Country Faces A “Third Wave”
Consumer economic sentiment saw its first decline in over two months as the country experiences an uptick in new COVID-19 cases, averaging 71,000 new cases a day over the past week. The latest reading of the HPS-CivicScience Economic Sentiment Index (ESI) declined 1.3 points to 50.0, marking its first drop in confidence since August 18 and mirroring the month-long decline beginning in late June as the nation experienced a COVID “summer surge.”
In the last reading before Election Day, four of the ESI’s five individual indicators fell during the two-week reading period. The largest decline was a 2.8 point drop in confidence toward the housing market, falling to 52.8, its lowest reading since May. Following close behind was a 2.0 drop in the job market, which is now 3.4 points below its September high of 43.4. Confidence in making a major purchase and in personal finances also fell, declining by 1.3 and 1.0 points, respectively. Confidence in the U.S. economy was the sole indicator to rise during the reading, increasing 0.7 points to 54.8, continuing the trend of a significant divergence of confidence in the economy compared to the job market.
The decline in confidence over the past two weeks comes as the rise in new virus cases has many experts concerned the country is entering a third wave of the COVID outbreak heading into the winter months, with states in the Midwest and Mountain West bearing the brunt of the increase. Congressional deadlock over a new round of stimulus funding and rising case levels are helping drive market uncertainty and inching the nation closer to the expiration of enhanced programs for unemployed workers in December.
The ESI’s three-day moving average began the two-week stretch at 49.8, rising to its two-week high of 51.5 on October 18. The moving average fell to its low of 48.6 on October 22 before closing out the reading with a period of significant fluctuation, ending at 50.0.
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.
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.