Drumbeat of bad news continues to drive consumer sentiment down

    RBC CASH Index for July Reaches New Low of the Year

    NEW YORK, July 3 /CNW/ - Soaring gas and food prices and a stock market
that just endured its worst June performance since the Great Depression are
draining consumers' wallets as well as their confidence, according to the most
recent results of the RBC CASH (Consumer Attitudes and Spending by Household)
Index. The survey found that, while consumer attitudes regarding the
employment market show signs of stabilizing, Americans' confidence in future
personal financial conditions, current conditions and investments continue to
weaken. As a result, the overall RBC CASH Index for July 2008, released today
by RBC, dropped to 14.6, a new all-time low since its inception in 2002,
compared to 22.5 in June.
    "The decline of the RBC CASH Index suggests that consumer sentiment has
fallen to the dismal level of the early 1980s. Consumers are being ground down
by the cumulative effects of high gasoline and food prices, a falling stock
market, weakening housing values and a shaky job market," said T.J. Marta,
Economic and Fixed Income Strategist for RBC Capital Markets. "Unfortunately,
these negative conditions are likely to persist well beyond when the last of
the tax rebate checks is cashed in July. Consequently, consumer sentiment is
unlikely to reach healthy levels anytime soon."
    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
June 26 - 29, 2008, by survey-based research company Ipsos Public Affairs. The
margin of error was plus or minus 3.1 per cent.

    Highlights of the survey results include:
    -  Consumers' confidence in the future waned considerably as the RBC
       Expectations Index dropped nearly 11 points this month to -54.7, down
       from the -43.9 reading in June. Bleak economic times appear to have
       become self-reinforcing as fewer than one in five Americans
       (18 per cent) think their local economy will strengthen in the next
       six months, compared to 22 per cent last month. Worries over prospects
       for their personal finances continued to plague consumers as only one
       in four Americans (25 per cent) expect their personal financial
       situation to improve over the next six months, down from 31 per cent
       in June.

    -  Americans' negative views of the current state of their personal
       finances helped to drive down the RBC Current Conditions Index to 30.5
       this month, compared to 40.5 in June. Currently, 37 per cent of
       respondents rate their personal finances as weak, up from 30 per cent
       last month. Consumers' evaluations of the current state of their local
       economy also continued to deteriorate, as nearly half of Americans
       (48 per cent) rated their local economy as weak, up from 44 per cent
       in June.

    -  The RBC Investment Index stands at 36.1, down nine points from June's
       level of 45.1. The decline in Americans' attitudes regarding investing
       is being driven mostly by the weakness in their current personal
       finances. Seven in ten Americans (71 per cent) believe the next
       30 days will be a bad time to invest in the stock market, versus
       66 per cent in June.

    -  In spite of broader concerns about economic weakness, Americans'
       confidence in job security remained stable this month. The RBC Jobs
       Index for July stands at 89.1, compared to 87.3 last month. The number
       of Americans reporting personal job loss experience was statistically
       unchanged, with 41 per cent reporting that they or someone they know
       personally have lost their job as the result of economic conditions,
       compared to 43 per cent last month. In addition, confidence about
       personal job security held steady, with 58 per cent of Americans
       saying they are less confident about their personal job security now
       than they were six months ago, compared to 57 per cent in June.

    The entire RBC CASH Index report can be viewed at:

    RBC (RY on TSX and NYSE) is Canada's largest bank as measured by assets
and market capitalization and one of North America's leading diversified
financial services companies. In the United States, RBC provides personal and
commercial banking, wealth management, insurance, corporate and investment
banking and transaction processing services to about two million clients
through RBC Bank, RBC Insurance, RBC Wealth Management and RBC Capital
Markets. The company employs approximately 70,000 full- and part-time
employees who serve more than 15 million personal, business, public sector and
institutional clients throughout offices in North America and 36 countries
around the world. For more information, please visit www.rbc.com.

For further information:

For further information: Loretta A. Healy, The Hubbell Group, Inc.,
(781) 878-8882; Kevin Foster, RBC Capital Markets, (212) 428-6902

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