Americans Have Increasingly-Pessimistic Views Of Economy
Bloomberg News reported that the latest Bloomberg Consumer Comfort Index fell to 44.2 for the period ending Jan. 31, the second weekly decline for the index since the end of November. The decline came after the previous week’s reading of 44.6, which was the highest in three months. The latest index showed that fewer respondents than any time in the previous month believed “the economy was getting better, while a drop in stock prices led to dimmer views of personal finances.” Fully 64% of respondents reported “negative views about the economy,” with the overall measure of current economic views falling to 36.5, the lowest so far in 2016. At the same time, the measure of the buying climate climbed to 40.6, its highest level since April 2015, and confidence among people 45 to 54 was at its “highest since September 2007.” Looking by region, the South reported its “most optimistic” readings since November, while the Midwest saw confidence decline. Summing up the results, Langer Research Associates president Gary Langer said, “We are not seeing an improvement, but we are not seeing any deterioration, which is positive given the conditions we are seeing. Consumers are somewhat cautious in their outlook.”
What This Means For Small Businesses
The latest results of the Bloomberg Consumer Comfort Index mirror those in the latest NFIB Small Business Economic Trends report, which showed a decline in small business owners’ confidence in January in the wake of uncertain economic conditions. NFIB Chief Economist William Dunkelberg said of the current economic situation, “The Small Business Optimism Index fell a bit more than one point, not much of a response to stock market turbulence or the Federal Reserve’s move to raise interest rates. The decline in optimism was accounted for by two important Index components, expected business conditions in six months and expected real sales.” He cautioned that “overall, it is unlikely that anything will occur that will raise the spirits of small business owners.”
NFIB previously covered the University of Michigan’s consumer confidence findings for January.
Note: this article is intended to keep small business owners up on the latest news. It does not necessarily represent the policy stances of NFIB.