Confidence Back at Five-Year High, But for How Long?
It should be interesting to see what the other major consumer confidence surveys say in the period ahead as the combination of higher payroll taxes, wrangling over the budget in Washington, and, very recently, a surge in gasoline prices have made gauging the consumer mood quite difficult over the last month or so.
Spirits have clearly been buoyed by rising home prices, rising stock prices, and yet another episode of kicking the can down the road when it comes to the nation’s debt woes. As a result, in Gallup’s latest survey, their economic confidence index is back at it highest level since 2007.
It should come as no surprise that Democrats are more hopeful than Republicans. Given how things have panned out for the GOP since the election, you’d think that their mood would have turned even more sour rather than seeing the modest improvement shown. As always, Independents are the more accurate barometer of the nation as whole and confidence in this group has improved substantially over the last year.
But, the double-whammy of less take-home pay (via the end of the payroll tax holiday) and higher gasoline prices (up 18 cents last week to a record high for this time of the year as detailed here yesterday) could soon begin to take a toll and this Gallup survey showing job creation at an 11-month low isn’t going to help either.
Source: Iacono Research
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