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.
Excerpt From the Latest Reading:
Consumer confidence rose for the second straight reading on April 29, following March’s record-breaking decline. The HPS-CivicScience Economic Sentiment Index (ESI) inched upwards, building on last reading’s 1.5 point increase, rising 2.1 points to 44.7. The rise was driven by a strong increase in confidence in making a major purchase and the housing market. Despite its April increase, the recording still remains one of the ESI’s lowest ever.
Four of the ESI’s five indicators rose over the past two weeks. Gains in confidence toward making a major purchase and the housing market drove the sentiment increase with each measure rising, 4.8 and 4.4 points, respectively. Confidence in making a major purchase now stands at 38.6 while confidence in the housing market stands at 44.7, but both remain significantly lower than their previous 2020 highs of 57.4 and 54.4. Confidence in personal finances also rose 2.3 points to 51.9 on the heels of the Internal Revenue Service beginning to roll out stimulus payments to eligible Americans. Confidence in the U.S. economy also rose by 1.5 points to 56.2, a new 2020 high. Following four record-shattering weeks of unemployment claims, confidence in the job market fell by 1.5 points to 32.2, hovering around its all-time low.
The increase in economic sentiment comes amid an inflection point for economic activity as some states begin to loosen stay at home orders and position towards reopening, while others have extended their orders further into May. Congress has also acted to continue to boost the economy by passing a new $484 billion relief packaged primarily aimed at expanding the Paycheck Protection Program, which is designed to aid small businesses across the country. Despite 26 million people filing for unemployment insurance over the past five weeks and oil futures going below $0 for the first time ever, stocks continue to rise on optimism toward a return to economic activity.
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