NEW YORK, April 6 /CNW/ - Americans' economic enthusiasm continued to
erode, hitting a six-month low heading into the second quarter, according to
the most recent results of the RBC CASH (Consumer Attitudes and Spending by
Household) Index. The survey, which measured the attitudes of 1,000 Americans
earlier this week, found that overall consumer sentiment decreased by nearly
seven points in April, driven by declines in all facets of consumer attitudes.
As a result, the RBC CASH Index, released today by RBC, stands at 85.4,
compared to 92.3 in March.
"The decline in consumer confidence to its lowest level since October is
consistent with the increasing price of gasoline, rising mortgage rates and
continuing headlines about the housing correction," said T. J. Marta, Economic
and Fixed Income Strategist for RBC Capital Markets. "Overall, the
across-the-board downturn may indicate further erosion of economic confidence
in coming months, especially if gas prices continue to increase."
The RBC CASH Index is a monthly national survey of consumer attitudes on
the current and future state of local economies, personal finance situations,
savings and confidence to make large investments. The Index is composed of
four sub-indices: RBC Current Conditions Index; RBC Expectations Index; RBC
Investment Index; and, RBC Jobs Index. The Index is benchmarked to a baseline
of 100 assigned at its introduction in January 2002. This month's findings are
based on a representative nationwide sample of 1,000 U.S. adults polled from
April 2-4, 2007, by survey-based research company Ipsos Public Affairs. The
margin of error was plus or minus 3.1 per cent. Highlights of the survey
- Negative views of the current state of the economy continue to
outweigh positive views, with more than one-quarter of Americans
(27 per cent) rating their local economy as weak, and slightly more
than one-fifth (22 per cent) rating their local economy as strong.
The RBC Current Conditions Index dropped to 99.0 in April from 107.5
- Consumers' confidence in the future weakened again this month as the
RBC Expectations Index decreased nearly eight points to 41.7, down
from 49.3 in March. While nearly one in four consumers (23 per cent)
continue to believe their local economy will be stronger six months
from now (compared to 24 per cent in March), perceptions that the
local economy will be weaker in six months increased an additional
two points this month to 19 per cent, which is nearly double the
response (11 per cent) in February.
- Americans' attitudes toward making major purchases (such as a home or
car) also waned again in April as half of respondents (48 per cent)
report they are currently less comfortable making a major purchase
than they were six months ago, compared to 44 per cent last month.
- Although consumers' views of both the current economy and their
future prospects are darkening, their overall opinions regarding
investing basically held steady this month. The RBC Investment Index
stands at 92.3, down from 96.4 in March, as consumers who reported a
"weak" rating of their personal financial situation increased two
points, to 26 per cent, and those who reported greater confidence in
their ability to save and invest in the future dipped one point, to
41 per cent.
- Despite a slight overall decline, Americans' confidence regarding job
security remained the strongest facet of consumer sentiment this
month. The RBC Jobs Index for April stands at 126.4, compared to
128.4 in March. Confidence about personal job security slipped
somewhat, with 39 per cent of Americans saying they are less
confident about job security than they were six months ago (versus
35 per cent in March).
The entire RBC CASH Index report can be viewed at:
For further information:
For further information: Loretta Healy, The Hubbell Group, Inc., (781)
878-8882; Kevin Foster, RBC Capital Markets, (212) 428-6902