WASHINGTON, D.C. -- Americans' confidence in the economy improved for the fifth month in a row in January, with Gallup's Economic Confidence Index reaching -27, its highest point since May of last year. Americans, however, are not yet as confident as they were a year ago.





Americans' confidence in the economy has been improving every month since August, when it hit recession levels, plummeting to -52 after the heated battle over the federal debt ceiling in Washington, and Standard and Poor's subsequent Aug. 5 downgrading of the nation's credit rating.

Weekly economic confidence was relatively high throughout January, ranging from -29 to -25. The -25 recorded last week and in the week ending Jan. 22 are the best weekly readings since May 2011.





Gallup's Economic Confidence Index measures Americans' ratings of economic conditions today and their perceptions of whether economic conditions in the country as a whole are "getting better" or "getting worse."

Americans' increasing optimism about the economy's direction is largely responsible for the improvement in the overall monthly index. The percentage of Americans who say economic conditions are getting better has doubled since August, climbing to 36% in January. This is the most positive Americans have been on this metric since May, but still not quite as positive as they were in January of last year (41%).

Americans' ratings of current economic conditions also improved in January, but to a somewhat lesser degree; still, they have essentially recovered to May levels.

Economic Confidence Improves Across Income Groups

Upper-income and middle- and lower-income Americans' confidence in the economy improved in January, to the highest ratings since May of last year.

Economic confidence among upper-income Americans had sunk below that of middle- and lower-income Americans in August. However, it has since recovered, and again is better than that of their lower-income counterparts -- as is typical.





Bottom Line

Americans' confidence in the economy increased in January, as Gallup's Economic Confidence Index rose to -27, improving for the fifth month in a row. An improving jobs situation over the past several months has likely contributed to Americans' growing positivity.

It is possible that Gallup will pick up further improvement this week after the very positive Labor Department unemployment report out last Friday, which sent the Nasdaq to an 11-year high and gave the Dow its best close since 2008.

Still, economic news changes quickly, and job market momentum will need to continue if the improvement in Americans' economic confidence is to persist. Economic confidence still has a long way to go to get into positive territory.

Gallup.com reports results from these indexes in daily, weekly, and monthly averages and in Gallup.com stories. Complete trend data are always available to view and export in the following charts:

Daily: Employment, Economic Confidence and Job Creation, Consumer Spending

Weekly: Employment, Economic Confidence, Job Creation, Consumer Spending

Read more about Gallup's economic measures.

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