As the economy emerges from its pandemic-induced slump, there is a growing feeling of optimism that is spilling over from the financial markets into the lives of everyday Americans. According to a new survey by Gallup, 37 per cent of Americans are feeling better about the current economy and the direction it is headed.
The survey, which surveyed 1,000 adults for one month ending January 24, shows that slightly more than one-third of adults felt either “somewhat” or “very” good about the economy currently and the outlook for the future.
This sentiment reflects the cautious optimism that has been slowly taking shape in recent months as Covid-19 cases, hospitalizations, and deaths have all tapered off. The recent surge in job creation, combined with the growing availability of vaccines, has only added to the improved outlook.
While more than one-third of respondents felt generally positive about the current economic state, a solid majority still had a more pessimistic outlook. Around 42 per cent of those surveyed felt that the economy was either “somewhat” or “very” bad, while the remaining 21 per cent were undecided.
Inflation is another topic where optimism varied. Consumer price inflation has remained general low throughout the pandemic, rising by just 1.7 per cent year-over-year in December. However, recent surging commodity prices and strong growth in spending have raised the possibility of higher prices in the coming months.
Gallup found that only 6 per cent of those surveyed felt “very” good about inflation currently, a figure that was overwhelmingly dominated by those feeling “somewhat” or “very” bad about it. Despite this negative sentiment, however, the majority of respondents (37%) revealed that their expectations of inflation improving weren’t based on their current sentiment towards it, but rather on other factors such as the increasing availability of vaccines and the recovering labor market.
Ultimately, while the optimism of the majority of Americans seems to be on the rise, it is clear that in regards to the current economic and inflationary outlook, much is still uncertain. Only time will tell if the positive sentiment of the past few months continues to spread, or if it is eventually snuffed out by its realities.
