Photo: REUTERS/Robert Galbraith
The IBD/TIPP Economic Optimism Index fell 10.8 per cent in March to 42.2, down from 47.3 in February.A reading below 50 indicates net pessimism.
“Americans across-the-board think that the economic outlook is grim,” said Raghavan Mayur, president of TIPP.
“The big slide in our economic outlook sub-index perhaps signals a turning point and an impending entry into a recession. This month 60 per cent believe that the economy is in a recession.”
The index has three key components and all of them decline in March.
- The Six-Month Economic outlook sub-index fell 18 per cent to 38.8. This stood at 32.1 when the economy entered a recession in December 2007.
- The Personal Financial Outlook sub-index fell 4.4 per cent to 52.2. This gauges how Americans feel about their own finances.
- Confidence in Federal Economic Policies sub-index fell 11 per cent to 35.5.
Consumers have been hit by higher taxes, and the “cynical manipulation and exaggeration of the impacts of the sequester in Washington”.
The IBD/TIPP Economic Optimism Index is considered a good leading indicators to other consumer confidence indicators like University of Michigan consumer confidence.
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