U.S. consumers still pessimistic about economy, but starting
to show optimism about their personal finances: RBC Consumer
Outlook Index
NEW YORK, April 8, 2010 — A majority of
Americans (82 per cent) feel their local economy will stay
the same or weaken within the next six months, according to
inaugural survey findings from the RBC Consumer Outlook Index,
the new monthly survey of U.S. consumers released today by
RBC. However, there are signs of growing confidence, with
just over half of Americans (51 per cent) now feeling optimistic
about their personal financial situations.
The RBC Consumer Outlook Index provides the most comprehensive,
forward-looking analysis of consumers' national and local
perceptions of the economy and their personal financial situation
based on a representative nationwide sample of 1,007 U.S.
adults polled from April 1-5, 2010, by research company Ipsos.
Going forward, RBC will publish the Index on a monthly basis.
Future reports will include comparisons and analysis regarding
significant shifts in consumer attitudes and behaviours, as
well as regional breakouts.
"We strongly believe this first look at what consumers
are thinking now will be of tremendous value to those looking
for insightful and predictive market analysis," said
Marc Harris, Co-Head of Global Research at RBC Capital Markets.
"We think that investors will tune in for the data, talk
about it and trade on it."
Unlike other indices which take a retrospective approach,
RBC's monthly index offers market participants the most up-to-date
and detailed projections of the attitudes and behaviours of
U.S. consumers. With 36 questions, more than double the number
of other indices, the RBC Consumer Outlook Index is unmatched
in terms of depth, providing a rich trove of data for a better
understanding of what consumers are thinking now regarding
their personal financial situation, job status and security
and the current and future state of the national and local
economies. The survey also includes a fixed number of questions
related to spending, saving and investor confidence.
The survey found that consumers are also increasingly confident
about their current personal financial situations. More Americans
feel good (51 per cent) than bad (45 per cent) about their
personal financial situation, a reversal of March benchmark
data (42 per cent good versus 55 per cent bad). Consumers
also feel better about their spending money, up six points
from March benchmark data (42 per cent good in April versus
36 per cent good in March).
Although close to half of consumers (46 per cent) expect
interest rates to increase over the next six months, they
are also split on whether now is a good time to buy real estate,
such as house or a vacation property, with 34 per cent saying
now is a good time to buy and 36 per cent saying it is not.
Despite gains in the stock markets over the past year, Americans
also are divided over whether this is a good time to invest
in the markets, with 20 per cent saying it is a good time,
28 per cent saying it is a bad time and 52 per cent saying
they are unsure. However, this is an improvement from benchmark
data collected in March, when 38 per cent thought it was a
bad time to invest.
Asked if they are more or less confident about job security
for themselves, their family or other people they know personally,
only 13 per cent of those polled said they are more confident,
41 per cent said they are less confident and 42 per cent said
their comfort level had not changed. Again, however, this
was an improvement over March's unreleased benchmark data,
when 49 per cent were less confident.
"While consumer expectations remain weak in an absolute
sense and may not be improving at a torrid pace, they continue
to show incremental improvement and steady progress after
bottoming out during the financial crisis and recession, particularly
with consumers showing growing confidence in their personal
financial situations," said Harris. "People do feel
somewhat better but are by no means ready to let loose and
rejoice."
Americans' cautiousness is reflected in their plans to use
expected tax refunds. Four-in-ten (45 per cent) of those respondents
who believe they are receiving a tax refund this year said
they would use the refund to pay down or pay off debt, and
26 per cent said they plan to save their refund. Just 28 per
cent plan to use a tax refund to buy things they want or need.
While a slight majority of Americans (56 per cent) continue
to believe the United States is on the wrong track, this was
an improvement from benchmark data collected but not released
in March, where 62 per cent felt the U.S. was heading in the
wrong direction.
Finally, Americans expressed skepticism about the benefits
of the recently enacted healthcare reform legislation. A majority
of Americans think that healthcare reform will result in their
seeing higher taxes (75 per cent), higher out-of-pocket healthcare
costs (68 per cent) and a reduced quality of care (53 per
cent). Three-quarters of the survey respondents (76 per cent)
doubted that healthcare reform would lower their health insurance
premiums.
About The RBC Consumer Outlook Index
The RBC U.S. Consumer Outlook Index provides the most up-to-date
and comprehensive outlook of U.S. Consumers based on data
collected from interviews with a nationally representative
sample of 1,007 U.S. adults conducted over a five-day polling
period during the first week of each month by Ipsos, the world's
second-largest market and opinion research firm. The results
in this news release reflect some of the findings of the Ipsos
poll conducted April 1-5, 2010. The RBC Consumer Outlook Index
is released within 36 hours after the U.S. online panel members
are interviewed. Weighting is employed to balance demographics
and ensure that the survey sample's composition reflects that
of the U.S. adult population according to Census data and
to provide results intended to approximate the sample universe.
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Contacts:
Kevin Foster,
RBC, kevin.foster@rbc.com,
(212) 428-6902
Kait Conetta,
RBC, kait.conetta@rbc.com,
(212) 428-6409
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