Economy

Coronavirus Threat Doesn't Weigh on Consumer Sentiment

SDI Productions / Getty Images

The Morning Consult index of consumer sentiment retained its positive trend last week. As of January 26, the consumer index score was 114.5, up from a 113.9 score at the end of the prior week.

The index is based on the firm’s daily survey of some 7,500 U.S. adults and is higher than it was at this time last year. The 52-week low of 106.7 was posted on January 27, 2019, and the 52-week high of 114.8 was set on December 30.

The gap between the index’s component scores widened slightly in the week ending January 26, with the future expectations score rising by 0.9 points to 115.4 and the current conditions score rising by 0.3 points to 113.3.

According to Morning Consult, “While markets closed lower on Monday amid fears of the coronavirus, those fears have yet to materially affect the economic outlook of U.S. consumers. … However, short of a full-blown epidemic in the U.S., there is no immediate reason to believe the coronavirus poses a long-term threat to consumers’ finances or the country’s economic outlook.”

Morning Consult asks the same questions of its survey respondents as does the University of Michigan’s twice-monthly Survey of Consumers. The difference is in the number and method of the survey. The Michigan sentiment index is based on 600 telephone interviews with U.S. adults while Morning Consult’s results are based on an ongoing survey comprising 7,500 daily interviews and 210,000 monthly interviews, all conducted online.

The survey breaks down the data it collects by some key demographic groups. Here are some of the results of that breakdown.

Households with income of less than $50,000 annually posted an overall sentiment score of 108.7 last week, up 1.3 points from the previous week. Among households with income between $150,000 and $200,000, the overall score rose by 2.2 points, and overall sentiment among households with incomes between $200,000 and $250,000 rose by 3.6 index points to post a score of 130. Households with incomes over $250,000 posted a rise of 3.4 index points to 130.5.

By industry sector, Americans employed in health care occupations reported a gain of 2.8 points to 119.7, with leisure and hospitality workers posting a gain of 4.2 points to an index score of 115.5. Consumer confidence in the real estate and property sector fell by 5.7 points to 123.5.

Sentiment in the agriculture industry rebounded last week, adding 9.8 points to lift the industry’s index reading to 129.7.

Top executives in businesses of every size were less enthusiastic about the economy than consumers as a whole. Sentiment among CEOs with between six and 20 employees posted a 7.2 point drop in overall sentiment for a score of 120.9. Sentiment among CEOs leading businesses with more than 100 employees fell by two points to 149.4, while sentiment among CEOs of business with 21 to 100 employees saw a 1.1-point decrease to 131. Top executives at businesses with one to five employees posted an index score of 119.5, down slightly week over week.

Looking at responses to questions about future economic conditions, top executives of companies with more than 100 employees posted an index score of 149.6, down by 3.1 points week over week. At companies with one to five employees, executives raised the score by 1.6 points to 122.8.

Company executives’ opinions of current economic conditions fell by 3.6 points last week, with the index score dropping to 120.3. CEOs of companies with six to 20 employees were the gloomiest, lowering their index score by 7.8 points to 121.


Get Ready To Retire (Sponsored)

Start by taking a quick retirement quiz from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes, or less.

Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.

Here’s how it works:
1. Answer SmartAsset advisor match quiz
2. Review your pre-screened matches at your leisure. Check out the advisors’ profiles.
3. Speak with advisors at no cost to you. Have an introductory call on the phone or introduction in person and choose whom to work with in the future

Get started right here.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.