Overall current economic conditions in Utah remain strong, though consumer positivity regarding the future economy has declined in the past month.
The Zions Bank Utah Consumer Attitude Index (CAI) dropped 4.7 points to 115.8 in December. In comparison, the national Consumer Confidence Index® decreased 8.3 points to 128.1 this month.
The Utah Present Situation Index decreased 1.7 percent to 132.1, while the Utah Expectations index fell 6.6 points to 105.0. Regarding the fitness of the current economy, Utahns remain quite pleased. About 58 percent feel business conditions are good, a dip of 6 percent from last month’s record-setting high. And 63 percent feel jobs are plentiful, an increase of two percent from last year.
Although Utahns are pleased with the current situation, they feel more reserved about future trends. Due likely to recent stock market fluctuations, the percentage of Utahns who believe current 401(k) investments will be worth more a year from now decreased from 49 percent to 39 percent, a full 10 percent drop.
“It appears that fluctuations in the stock market are impacting consumer perceptions,” said Scott Anderson, Zions Bank president and CEO. “When Utahns see decreases in their investment portfolios, they feel less wealthy, which can affect future willingness to spend.”
Despite changing perceptions with regards to the investment market, other market signals indicate economic growth will continue in the state. Utah consumers continue to report that jobs are plentiful and 95 percent of Utahns expect that their incomes will either increase or remain the same in the next six months.
“Federal Reserve rates have just increased for the fifth consecutive quarter,” said Randy Shumway, chairman and partner of Cicero Group. “Rate increases are designed to tap the breaks on inflation, but are also a sign that the Federal Reserve Bank has confidence in the economy’s future. Here in Utah, while we are seeing a few blips in the national markets currently, fundamentals around job growth and population growth remain very strong.”
Zions Bank provides the CAI as a free resource to the communities of Utah. The monthly CAI summary reports are released at a monthly press conference, coinciding with The Conference Board’s national CCI release date. Analysis and data collection for the CAI are done by Cicero Group, a premier data-driven strategy and research firm based in Salt Lake City.