Consumer Optimism Remains Relatively Unchanged From October 2011
SALT LAKE CITY, Utah; November 29, 2011 — In November, on a seasonally adjusted basis, the Zions Bank Consumer Attitude Index (CAI) decreased slightly to 67.7, a drop of 0.4 points compared to October 2011. The national Consumer Confidence Index® (CCI) increased 15.1 points to 56.0. An index of 70 or below is indicative of slow economic growth.
The Zions Bank CAI Present Situation Index, which is a snapshot of current business conditions and employment, decreased to 41.5, a drop of 5.6 points. Nationally, the CCI Present Situation Index increased 11.2 points to 38.3. The Expectations Index for six months from now, which more closely projects the direction of consumer spending, increased 3.0 points to 85.2 in Utah, while the national CCI Expectations Index increased 17.8 points to 67.8.
The CAI helps gauge the degree of optimism that local residents have toward the Utah economy. Comparing local and national attitudes enables consumers, businesses, and policymakers to identify key economic trends unique to Utah. In addition to the CAI, Zions Bank asks several key questions that help lend further insight into the economic attitudes of consumers.
In November, consumers had an increasingly positive outlook on the price of homes. Sixty-nine percent indicated they see home prices remaining the same or increasing over the next 12 months, compared to 66 percent in October. They also see increased stability in employment, with sixty-seven percent believing they are unlikely to lose a job that they wanted to keep for the next two years.
However, Utahns see increasing prices in the future. Three out of four consumers (73 percent) believe gasoline prices will increase over the next twelve months, compared to 69 percent last month. Eighty-two percent of consumers believe the prices for consumer goods will go up over the next year, versus 77 percent in October. More than half (61 percent) of consumers indicated their household income is unlikely to keep up with the rate of inflation in the next two years.
Utahns are also concerned about the government’s handling of the economy. Only 3 percent believe the federal government is doing a good job when it comes to taking steps to improve the economy, while 68 percent believe it is doing a poor job. Views of the state are more positive, with 26 percent who believe the state government is doing a good job versus 21 percent who believe it is doing a poor job to improve the economy.
When asked to rate what will happen to the U.S. economy in the next 12 months, a majority of respondents (55 percent) believe it is unlikely or very unlikely to improve, while the remainder believes there is some chance of improvement.
Taken as a whole, this month’s index reflects mixed emotions among Utah consumers. Overall confidence has remained cautiously optimistic, with concerns about the present situation, but increasing confidence in the future recovery. Although consumers’ attitudes remain mixed, the state is much more optimistic than the nation overall. For Utah, this may result in stronger job outlook, consumer spending, investment, and overall recovery than the nation.
Zions Bank provides the CAI as a free resource to the communities of Utah. The monthly CAI summary reports are released at a monthly press conference, coinciding with The Conference Board’s national CCI release date. The reports are available online at www.zionsbank.com/cai. Analysis and data collection for the CAI are done by The Cicero Group/Dan Jones & Associates, a premier market research firm based in Salt Lake City. The December CAI will be released at a press conference at a Salt Lake-area business at 10:30 a.m. on December 27, 2011.
Zions Bank is Utah’s oldest financial institution and is the only local bank with a statewide distribution of financial centers, Zions Bank operates locations in communities throughout Utah and Idaho. In addition to offering a wide range of traditional banking services, Zions Bank is also a leader in small business lending and has ranked as the No. 1 lender of U.S. Small Business Administration 7(a) loans in Utah for the past 18 consecutive years. Founded in 1873, Zions Bank has been serving the communities of Utah for more than 135 years. Additional information is available at www.zionsbank.com.