SALT LAKE CITY — Utahns’ confidence in the economy came down from a 16-month high in April as the Zions Bank Consumer Attitude Index decreased 6.3 points to 79.0 in May.
The U.S. Consumer Confidence Index decreased 3.8 points to 64.
The high price of gasoline, the impending presidential election, and the European debt crisis are taking their toll on consumer confidence, said Randy Shumway, chief executive officer of the Cicero Group. Still, Utahns are more optimistic than the nation as a whole, and far more optimistic than they were six months ago, he added.
The Zions Bank Consumer Attitude Index is 11 points higher than it was in November of last year.
"Consistently, we're seeing an improvement in overall consumer confidence," he said.
Consumer sentiments toward housing prices, fuel prices and general inflation are stabilizing.
"Six months ago, the critics were suggesting that gasoline would be five dollars a gallon by Memorial Day weekend," Shumway explained. "(Today) we're 25 percent below that prediction, but people reacted to the those forecasts … causing people to react negatively."
Trepidation about future economic conditions, particularly the employment outlook, affected the CAI considerably in May, he said.
Recent economic indicators suggest that the economy continues to gather momentum, despite Utahns’ having a difficult time fully regaining their confidence. Consumer attitudes toward the housing market are improving, Shumway said.
"The houses that are available for purchase are decreasing, and we're seeing housing prices increase, with interest rates staying consistently low," he said.
Meanwhile, the Zions Bank Expectations Index — a gauge of consumer confidence in the economy six months from now — decreased 6.7 points to 91.7, while the national CCI Expectations Index decreased 2.8 points to 77.6. The Zions Bank Present Situation Index — a measurement of confidence in current business and employment conditions — decreased 5.7 points to 60.1, while the national CCI Present Situation Index decreased 5.7 points to 45.9.
Despite the recent declines, Shumway said the long-term outlook is still positive.
"Don't take any one month in isolation," Shumway said. "What we look at is a trend. And what we're seeing is a consistent trend of slow improvement."
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