Confident Consumers See Brighter Future in 2007: RBC CASH Index

U.S. consumer confidence soared at the start of the new year, as Americans are feeling much more optimistic about their economic future than they were at the close of 2006, according the RBC CASH (Consumer Attitudes and Spending by Household) Index.

Overall consumer sentiment increased more than eight points this month, as the RBC CASH Index for January released today by RBC Financial Group, jumped to 95.3, compared to 86.9 in December and 78.2 one year ago.

Highlights of the January survey results include:

  • Consumers' economic outlook has skyrocketed during the past month, as seen in the RBC Expectations Index, which stood at 83.8 in January, a dramatic increase from December's 55.0.  
  • 31% of Americans believe their local economy will be stronger six months from now, up from 24% in December. 
  • 40% of Americans said they believe their personal finances will be stronger six months from now.
  • Consumers' evaluations of the current local conditions softened slightly during the past month, producing a one-point drop in the RBC Current Conditions Index, bringing it to 94.3 in January. 
  • 21% rate their local economy as strong (down from 26 per cent in December). 
  • The RBC Investment Index for January stands at 83.2, a nearly one-point increase from the 82.5 level in December. Currently, 
  • 32% of consumers report they are more comfortable making a major purchase like a home or car, compared to 31% last month. 
  • 38% Americans reporting they believe the next 30 days will be a good time to invest in real estate, compared to 36 per cent in December. 
  • 44% of Americans believe the next 30 days will be a good time to invest in the stock market, a slight increase from the 41 per cent level in December.
  • Confidence in job security remained stable, with the RBC Jobs Index for January stands at 126.3, compared to 126.5 in December. 
  • 43% of consumers report they are more confident about current job security than six months ago 

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 1,002 U.S. adults polled from January 8 - 10, 2007, by survey-based research company Ipsos Public Affairs. The margin of error was plus or minus 3.1 per cent. 

The entire RBC CASH Index report can be viewed at: www.rbc.com/newsroom/rbc-cash-index.html.

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