Latest IBD/TIPP Poll Reflects Consumer Unrest

Economic Optimism Index, Presidential Leadership Index, and National
Outlook Index all fell across every category in February

LOS ANGELES–(BUSINESS WIRE)–The IBD/TIPP
Economic Optimism Index, a leading national poll on consumer
confidence, dropped 3.8 percent in February, hitting its lowest point
since October 2017. Its reading of 50.3 comes amid the recent government
shutdown and as consumers brace for a second shutdown amid the budget
stalemate.

This month’s poll saw Economic Optimism fall for the fourth consecutive
month. Nevertheless, the index continues its record run in positive
territory. The Economic Optimism Index has now spent 29 consecutive
months above 50. An index reading below 50 for the IBD/TIPP indexes
indicates pessimism while above 50 signals optimism.

The IBD/TIPP Economic Optimism Index has established a strong track
record of foreshadowing the confidence indicators issued later each
month by the University of Michigan and The Conference Board. IBD/TIPP
conducted its national telephone poll of 904 adults from January 24 to
February 1, using live interviewers and both cell phone and landline
numbers. The margin of error is +/-3.3 percentage points.

In addition to the Economic Optimism Index, IBD/TIPP surveyed
respondents on key political issues for the separate Presidential
Leadership Index and National Outlook Index, as well as the Financial
Related Stress Index. Each index took a hit in February. This rare
occurrence, in which every component across every index dropped, has now
happened twice during the Trump presidency. February’s poll saw the
Presidential Leadership Index fall by 4.8 percent, moving from 44.0 in
January to 41.9 this month. The Job Approval component of the index fell
by a substantial 8.0 percent.

The National Outlook Index decreased even more, falling from 44.4 last
month to 41.9 in February — a 5.6 percentage drop. While every measure
of the index went down, two components experienced a double-digit
plunge: Direction of the Country, which slid by 12.3 percent, and Morals
and Ethics, which dropped 13.9 percent.

The Financial Related Stress Index rose to its highest level since
October 2017. Stress increased by 6.8 percent, hitting 55.3. A reading
below 50 on this index indicates that consumers feel less financial
stress while a reading above 50 equals more financial stress.

“This month, the effects of the shutdown are becoming more apparent.
American sentiment reflects disapproval of how the government is
operating from both sides of the aisle. There is also uneasiness about
another shutdown looming just over the horizon,” said Terry Jones, IBD’s
Commentary Editor. “Still, and perhaps despite it all, the economy is
holding steady as we saw from the latest jobs report. If a second
extended shutdown happens, however, we could see a harsher picture in
March’s data.”

The flagship IBD/TIPP Economic Optimism Index has three key components.
This month, all three decreased.

• The Six-Month Economic Outlook, a measure of how consumers feel
  about the economy’s prospects in the next six months, dropped 4.9
  percent to 44.5. The component remains in negative territory for the
  third consecutive month. Still, this reading is substantially above
  the 32.1 reading when the economy entered the last recession in
  December 2007.
• The Personal Financial Outlook, a measure of how Americans feel
  about their own finances in the next six months, dipped by 1.6 percent
  to a reading of 60.0. This is its lowest reading in more than a year.
• Confidence in Federal Economic Policies, a proprietary IBD/TIPP
  measure of views on how government economic policies are working, fell
  the most. It moved from 49.0 to 46.3 — a 5.5 percentage drop. This
  also marks the third month in a row that this measure has decreased.

“Though our economic optimism index fell, it is still above 50 in the
positive zone. This despite the longest government shutdown in history,”
noted Raghavan Mayur, president of TechnoMetrica, IBD’s polling partner.
“The economy is roaring and the job market is strong. Gasoline prices
are low and this helps to offset any price increases due to trade wars.
However, Americans are experiencing an increase in financial stress.”

The Breakdown

This month, 10 of 21 demographic groups — such as age, income, race,
and party preference — that IBD/TIPP tracks were above 50 on the
Economic Optimism Index. That was down from 15 in January. Four groups
rose during the month, down from eight in January but up from just one
in December. Seventeen groups fell during the month.

On the Economic Outlook component, just two of the 21 groups that
IBD/TIPP tracks scored in optimistic territory, down from six in January
and from three in December. Thirteen groups were optimistic in November.

On the Personal Financial component, all 21 groups IBD/TIPP tracks
remained in optimistic territory, as eight groups rose, one stayed the
same and the rest declined. Even Democrats returned to optimistic
territory, despite the government shutdown. The index stood at 60 in
February, after hitting an all-time high of 66.7 in October.

On the Federal Policies component, four of the 21 demographic groups
tracked were above 50, down from seven in January and 11 in December.
Just three groups rose while 17 fell in February, and one stayed the
same.

ABOUT THE IBD^©/TIPP POLL

The IBD/TIPP Economic Optimism Index is the earliest take on consumer
confidence each month and predicts with good reliability monthly changes
in sentiment in well-known polls by The Conference Board and the
University of Michigan. The IBD/TIPP Economic Optimism Index is based on
a survey of 900-plus adults chosen at random nationwide. The national
poll is generally conducted in the first week of the month by live
interviewers and both cell phone and landlines.

For more information, go to www.tipponline.com.
To license the IBD/TIPP Poll, please contact: IBDlicensing@investors.com.

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Contacts

Marisa Lam
GMK Communications for IBD
marisa@gmkcommunications.com
650.544.3350