by Jharonne Martis.
WASHINGTON, DC – This past May, American consumer confidence, as measured by the Thomson Reuters/Ipsos Primary Consumer Sentiment, saw its largest change since 2010. This month’s mark of 59.8 is down four points from the previous mark of 63.8.
This biggest effects are caused by a 5.9 point decrease in the current index and a 5.6 point decrease in investment. These are largely affected by uncertainty in the direction of the economy. This uncertainty has also affected a small decrease in the job index, however, underlying trends such as recent personal experience with job loss, remained stable providing some mitigation to the decline.
“The past few months have seen the US withdraw from the Iranian JCPA, a frosting of relations between the US and the G7 members, and significant movement in North Korean relations with world powers. The geo-political landscape is changing quickly.” reported Chris Jackson, VP at survey research firm Ipsos. “The long term positive or negative effects of these changes will remain to be seen, but in the short term these movements have injected a high degree of uncertainty regarding the global economy. In such a case, most consumers would prefer to hold off on making decisions with potentially large financial implications. This is especially seen in the movement in the investment index.”
Jharonne Martis, Director of Consumer Research at Thomson Reuters, said, “Despite the geopolitical worries, the consumer is still engaged and the U.S. Retail sales posted sharp gains in May, which is expected to continue into the current quarter. The Thomson Reuters Retail and Restaurant Earnings Index continues to anticipate double digit growth for 2018.”
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The Thomson Reuters/Ipsos US Primary Consumer Sentiment Index (PCSI), ongoing since 2010, is a monthly national survey of consumer attitudes on the current and future state of local economies, personal finance situations, savings and confidence to make large investments. The Index is composed of four sub-indices: Current Conditions Index; Expectations Index; Investment Index; and, Jobs Index.