US Confidence Waning

Americans are less confident in the country’s economic outlook than they were a month ago, according to the lastest survey from Gallup. The reading for February is -23, down from -20 in January. Overall, Americans still have low confidence in the US economy, but it is at about the same level as it was in early 2008, before the financial crisis hit with full force.

The bottom line, according to Gallup:

Americans are far less discouraged about the economy today than they were throughout the second half of 2011, and their confidence continues to recover in 2012.

Gallup noted last week that February’s unemployment trend is up, and that may be the reason that Americans are feeling less confident about the country’s economic conditions.

An alternative explanation is that rising gasoline prices are forcing Americans to re-think their recent more optimistic view of the economy. When gasoline prices were lower — in November and December — consumer optimism and spending were higher. As we’ve noted here, for every $0.01 increase in the pump price, consumers annually spend $1 billion less.