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:
Overall economic sentiment held steady over the course of a turbulent early October. After a two-week stretch during which the President contracted COVID-19, the odds of a Democratic electoral sweep grew, and the prospects of renewed economic stimulus were revived, the HPS-CivicScience Economic Sentiment Index (ESI) hung on at 51.5.
Though overall economic sentiment posted no changes over the past two weeks, the ESI’s five indicators did make moves. Making the biggest gain was confidence in personal finances, which rose 2.1 points to 58.2. Also rising were confidence in making a major purchase (up 0.7 points to 46.7) and confidence in the housing market (up 0.5 points to 55.6). Weighing these improvements down were decreases in the ESI’s remaining two indicators: confidence in the overall US economy declined 1.7 points, to 54.1, while confidence in finding a new job dropped 1.4 points, to 42.0. The latest reading marks the first time these two indicators have dropped since early July.
Politics dominated the headlines over the two-week period, notably the news that President Trump contracted, and was subsequently hospitalized for, COVID-19. The period also saw the President’s Democratic challenger, Joe Biden, build out his national and swing-state lead in the polls, with heightened expectations for a Democratic sweep of the presidency and both houses of Congress. In a move that may have a direct impact on Americans’ wallets, the President reversed course and endorsed another round of economic stimulus including $1,200 checks. Heightened expectations for stimulus pushed stocks to their best week since July.