US consumers’ financial wellbeing improves slightly
Alliance Trust’s Research Centre has launched a new measure, the US Financial Reality Index, which tracks US consumers’ financial wellbeing. The new index showed that US consumers saw a slight improvement in their financial wellbeing in the first quarter of this year as inflation eased the pressure on household budgets, but their situation remains extremely depressed. Improvement in US consumers’ financial health is considered essential to any US and global recovery – their spending makes up over 70% of US GDP and still accounts for almost a fifth of global GDP.
Shona Dobbie, Head of the Alliance Trust Research Centre said, “Results from our new US Financial Reality Index show that pressure on US consumers is easing, but only slightly. Falling prices mean people have a little more to spend but they are still facing enormous economic concerns, such as increased unemployment and the sharp reduction since the end of 2007 in their net wealth.
The research by Alliance Trust also shows that while US consumer financial wellbeing has now improved for two successive quarters, UK consumers have only seen an upturn over the last quarter. The index combines readings of the state of household budgets, net wealth and the economic background to show how well-off consumers are and it can be an indicator of future consumer spending trends as shown by the following graph.
View the full press release here
Download "US Financial
Reality Index" here
Visit the Alliance Trust Research Centre here
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