A one standard deviation drop is no small thing. Actual at 85.4 vs. 90.5 Bloomberg consensus, down from upwardly revised 94.2.
Figure 1: U.Michigan Economic Sentiment (blue), Conference Board Confidence Index (brown), Gallup Confidence (green), all demeaned and divided by standard deviation 2021M01-2025m02. Red dashed line at “Liberation Day” Source: UMichigan, Gallup, Conference Boardand author’s calculations.
From the Conference Board today:
“Confidence collapsed in January, as consumer concerns about both the present situation and expectations for the future deepened,” said Dana M Peterson, Chief Economist, The Conference Board. “All five components of the Index deteriorated, driving the overall Index to its lowest level since May 2014 (82.2)—surpassing its COVID-19 pandemic depths.”
I find it interesting that Democratic and Independent perceptions have converged (at a really low level), while Republican continue to hold up optimistically (with slight deterioration).
Source: Conference Board.
This is a slightly different picture, using U. Michigan data:
Figure 1: U. Michigan sentiment index for Republicans (black, left scale), Independents (red, left scale) and Democrats (blue, left scale), and SF News Sentiment (chartreuse, right scale). January observations for Sentiment are preliminary. January New Sentiment index for data through 1/25. Source: U.Michigan Survey of Consumers, and SF Fed.
Here too, Republican/lean Republican stand apart
