LOS ANGELES, June 07, 2018 (GLOBE NEWSWIRE) -- The IBD/TIPP Economic Optimism Index, a leading national poll on consumer confidence, rose 0.6 percent to 53.9 in June, continuing its record run. The index has now spent 21 consecutive months in positive territory, remaining above 50 since October 2016. An index reading below 50 indicates pessimism while above 50 signals optimism for the IBD/TIPP indexes.
The IBD/TIPP Economic Optimism Index has established a strong track record of foreshadowing the confidence indicators issued later each month by the University of Michigan and The Conference Board. IBD/TIPP conducted its national telephone poll of 905 adults from May 29 - June 5, using live interviewers and both cell phone and landline numbers. The margin of error is +/-3.3 percentage points.
In addition to the Economic Optimism Index, IBD/TIPP surveyed respondents on key political issues for the separate Presidential Leadership Index and National Outlook Index, as well as the Financial Related Stress Index (see separate story here for details). The Presidential Leadership Index fell 2.4 percent to 41.1 while the National Outlook Index decreased 1.9 percent to 45.9 despite the Direction of the Country component hitting its highest level (45.3) since February 2017, President Trump’s first full month in office. Additionally, the Financial Related Stress Index rose to 51.1, a 2.4 percent increase (a higher stress index indicates more stress).
“This month, responses reflected the political division occurring across America, splitting perspectives on issues ranging from Iran and North Korea, to the actions of the DOJ and CIA around the 2016 presidential election. We’re not seeing issues enjoy broad support across the spectrum,” said Terry Jones, IBD's Commentary Editor. “People are also divided on where the economy and national economic policy are eventually headed, particularly in light of the tariff situation, but they are more positively aligned when it comes to their own personal finances. The majority believe that their financial situation will stay the same or improve over the next six months. So, regardless of their view of the big picture, Americans don’t appear overly concerned about it affecting their financial lives in the near-term.”
The flagship IBD/TIPP Economic Optimism Index has three key components. This month, two of the three components decreased.
- The Six-Month Economic Outlook, a measure of how consumers feel about the economy’s prospects in the next six months, remained in positive territory despite a slight dip. Its June reading of 51.2 is just 0.2 percent below May’s 51.3 reading. This remains substantially above its 32.1 reading when the economy entered the last recession in December 2007.
- The Personal Financial Outlook, a measure of how Americans feel about their own finances in the next six months, was the only component to rise, building on last month’s 61.0 reading. June posted a reading of 62.1, increasing by 1.8 percent.
- Confidence in Federal Economic Policies, a proprietary IBD/TIPP measure of views on how government economic policies are working, remained in negative territory for the third consecutive month. May’s 48.5 reading dropped 0.4 percent in June to 48.3.
“Americans across the country are experiencing more pain at the pump, as gas prices hit a four-year high. Despite high gasoline prices, American economic confidence continues to be strong. In addition, a majority also believe that the economy is improving,” noted Raghavan Mayur, president of TechnoMetrica, IBD's polling partner. “Forty-four percent give the president good grades for his handling of the economy.”
The Breakdown
This month, 14 of 21 demographic groups -- such as age, income, race and party preference -- that IBD/TIPP tracks were above 50 on the Economic Optimism Index. That’s the same number as last month. Ten groups improved on the index, while 11 fell. Last month, 13 groups improved on the index, while seven declined and one remained the same.
On the Economic Outlook component, 11 of the 21 groups that IBD/TIPP tracks scored in optimistic territory. In the previous month, the same number of groups were optimistic.
On the Personal Financial component, once again all 21 groups IBD/TIPP tracks remained in optimistic territory, as 14 groups increased and seven declined.
On the Federal Policies component, nine of the 21 demographic groups tracked were above 50. Eleven groups rose, while 10 fell.
ABOUT THE IBD©/TIPP POLL
The IBD/TIPP Economic Optimism Index is the earliest take on consumer confidence each month and predicts with good reliability monthly changes in sentiment in well-known polls by The Conference Board and the University of Michigan. The IBD/TIPP Economic Optimism Index is based on a survey of 900-plus adults chosen at random nationwide. The national poll is generally conducted in the first week of the month by live interviewers and both cell phone and landlines.
For more information, go to www.tipponline.com. To license the IBD/TIPP Poll, please contact: IBDlicensing@investors.com.
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GMK Communications for IBD
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