Consumer attitudes about the economy, home prices, stock market and investments are improving, but many still say the country is headed in the wrong direction.
According to the monthly RBC Consumer Outlook Index, fewer consumers (37%) think the U.S. is on the right track compared to those polled a year ago (41%). This month’s index reflects the analysis of data from a survey of 1,007 U.S. adults taken September 30-October 3, 2010.
"True confidence continues to elude consumers," Marc Harris, co-head of Global Research at RBC Capital Markets, said in a statement. "While the October numbers saw a steady increase from the prior month’s reading in several areas, consumers’ attitudes have seen no consistent positive momentum since the beginning of 2010 as the economy continues to struggle. Overall, consumer confidence is barely treading water."
The index also shows that jobs are still the top concern among those surveyed. With the upcoming midterm elections less than four weeks away, one thing is clear: Job creation and protection is the most important issue for Americans (56%), and16% said keeping taxes low is the most important issue for Americans. Only 3% said fixing the housing market is most important.
OTHER INDEX FINDINGS
• Consumers are more optimistic this month than last, with only 38% of those polled saying the national economy will worsen over the next three months, down from 45% of those polled last month.
• Long term expectations continue to strengthen, with 25% of those polled saying the economy could get worse this year, down from 28% last month.
• Americans more optimistic about home values in their neighborhoods, with 31% of those polled this month saying the prices of homes in their neighborhood would increase in the year ahead, compared to 25% last month. Only 27% of those polled this month said home prices in their neighborhood would decline, a significant decrease from the 40% who expected a decline a month ago.
• The Current Conditions sub-index — a good proxy for how consumers feel right now about spending — was virtually flat month over month, which could be perceived as a concerning signal for the holiday selling season. The reading was 57.4 for October versus 57.0 for September.
• 34% of the stock-owning population polled said the next 30 days would be a good time to invest in the markets, compared to 26% of those who said this last month. However, the low reading means that despite the accommodative Fed commentary and a massive equity market rally in September, well over 50% of Americans polled say they are still not sure if now is a good time to invest in stocks.