Economic sentiment dropped over the past two weeks, matching one of the lowest readings in the past 12 months. The HPS-CivicScience Economic Sentiment Index (ESI) decreased 0.8 points to 40.5 to mark the first half of February.
Four of the ESI’s five indicators dropped over the past two weeks. The greatest decrease was in confidence in making a major purchase, which fell 0.9 points to 26.4. This was accompanied by drops in confidence in both finding a new job and buying a new home, which fell 1.4 points to 54.1 and 1.1 points to 27.1, respectively. Confidence in personal finances and the overall U.S. economy remained largely stable, with the former going up 0.1 points to 55.8 and the latter falling 0.1 points to 39.0. The Bureau of Labor Statistics (BLS) announced on February 10 that the Consumer Price Index (CPI) inflation metric increased 7.5 percent year-over-year, a 40-year high. Early February was also marked by market volatility, concerns over Russia-Ukraine relations, and Federal Reserve officials signaling they may consider interest rate hikes in March. Conversely, the BLS also announced nonfarm payroll increases of 467,000 in January, exceeding the 150,000 estimate.
