Confidence in the economy spurs Consumer Attitude Index to major hike

Utah consumers have high confidence that the economy will stay strong over the next six months, according to the Zions Bank Utah Consumer Attitude Index (CAI) released last week. The CAI showed a substantial increase in March, jumping 8.8 points to 123.5. The overall CAI currently sits just 8.1 points higher than its level 12 months ago following the large March hike.

By comparison, the national Consumer Confidence Index (CCI) increased 9.5 points from February to March and currently sits at 125.6.

“Consumer attitudes in Utah have reached an all-time high,” said Scott Anderson, president and CEO of Zions Bank. “Low unemployment coupled with expectations for even more jobs in the coming months contribute to an overall positive cycle that Utahns can benefit from for the foreseeable future.”

The Present Situation Index, a sub-index of the CAI that measures how consumers feel about current economic conditions, increased 5.6 points from February to March but sits just 0.2 points higher than it was at this time last year.

Expectations for the next six months increased 10.9 points in March due to a more positive outlook on future income potential and employment conditions:

• Forty-one percent of Utahns think their household income will be higher in six months, up from 37 percent in February.

• Thirty-five percent of Utahns believe there will be more jobs in their area in six months, which is up slightly from February.

• Thirty-four percent of Utahns think business conditions will be better in six months, which closely mirrors February’s expectations

Other metrics regarding economic confidence, interest rates, government economic policy and gasoline prices include:

• Fifty percent of consumers believe the U.S. economy will improve during the next 12 months, compared to 47 percent in February.

• Sixty-nine percent of Utahns think interest rates will go up in the next 12 months, up from 67 percent in February.

• Sixty-nine percent of Utahns believe the price of gasoline will go up over the next 12 months, compared to 62 percent in February.

• Twenty-six percent of Utahns think the federal government is doing a good job taking steps to improve the overall economy, up 7 points from February.

• Forty-four percent of Utahns think the state government is doing a good job, down from 48 percent in February.

“This month marks the first month in a long time that expectations for the future have mirrored sentiment about the current situation,” said Randy Shumway, chairman and partner of Cicero Group, a market research firm based in Salt Lake City that does analysis and data collection for the CAI. “High expectations propel the economy and give Utahns even more reasons to get out and invest in their next project.”