Discover® U.S. Spending MonitorSM Falls for First Time in Four Months
08 Luglio 2009 - 12:00PM
Business Wire
The Discover U.S. Spending Monitor fell for the first time in
four months from 86.2 to 85.6 (based out of 100), as consumer
attitudes toward the economy reversed course from the previous
three months with more consumers expressing concern over the
current state of the U.S. economy. Overall, 59 percent rated
current economic conditions as poor, a 4-point increase from the
previous month and the first increase since February.
While consumers are clearly concerned over current economic
conditions, the number feeling the economy is getting worse
remained at a Monitor-low 49 percent in June.
The drop in economic confidence also appeared to have little
effect on consumer attitudes toward personal finances. Thirty-three
percent currently rate their finances as good or excellent, the
same number reported last month.
But the reversal in consumer attitudes toward the economy
appears to be affecting discretionary spending intentions. Higher
gas prices, along with uncertainty as to whether the economic
recession has bottomed out has consumers either holding the line or
cutting their discretionary spending intentions in the month
ahead.
Anticipated Household Expenses Rise for the Fourth Straight
Month, Majority of Consumers Planning to Spend Less on
Discretionary Purchases
The number of consumers expecting to spend more in the month
ahead rose to 23 percent in June. This is the highest this number
has been since November 2008. The rise coincided for the second
straight month with an increase in the number of consumers
expecting to spend more on household expenses like gas and
groceries. For June, 35 percent of consumers expected to spend more
on household expenses, a 5-point increase from May and a 10-point
increase in the last two months. June saw the highest gas prices of
the year nationwide.
To adjust for an increase in household expenses, consumers
planned cutbacks on discretionary purchases like going out to
dinner or the movies. Over half, 51 percent, plan to spend less in
the month ahead on discretionary purchases, a 2-point increase from
the previous month. Half of consumers are also expecting to spend
less on home improvement purchases, the same as last month, and 48
percent of consumers said they�ll be spending less on major
personal purchases like a vacation, also the same as last month.
Even consumer savings wasn�t immune to possible cutbacks, as 40
percent of consumers planned on saving and investing less in the
month ahead, a 2-point increase from the previous month.
�The optimism we were seeing from consumers in terms of the
economy over the past few months may have hit a roadblock in June,�
said Julie Loeger, senior vice president of brand and product
management for Discover Financial Services. �With unemployment
still rising and uncertainty as to whether the economic recession
is ending, consumers are seeing no reason to change the spending
restraint they�ve exhibited over the last several months.�
Less Than Half Have Money Left Over
For the third straight month, less than half of consumers, 47
percent, have money left over after paying the monthly bills,
1-point lower than the previous month. Of those who do have money
left over, 79 percent plan on having the same or more money left
over than the previous month, a 1-point increase from the previous
month.
A constant bright spot for the Monitor has been the fact that
over the last six months less than 40 percent of consumers say they
are expecting an added expense or an income shortfall in the next
30 days. This trend continued in June with 39 percent saying they
were expecting an added expense or income shortfall.
Current Economic and Financial Conditions Still Dragging on
Consumers
Current economic and financial conditions are still a big
concern for a majority of consumers. Fifty-nine percent currently
rate the economy as poor and only 8 percent of consumers feel
economic conditions are good or excellent. Compared to a year ago
when gas prices were touching $4 per gallon, 15 percent of
consumers still felt the economy was good or excellent while 54
percent felt it was poor.
While the number of consumers rating their finances as good or
excellent remained unchanged at 33 percent in June, this number is
5 points lower than a year ago. Forty-nine percent feel their
finances are getting worse, also unchanged from the previous
month.
�Unemployment is the highest it�s been in 26 years and higher
gas prices have forced consumers to keep a tight budget. It is no
wonder consumers are concerned about the economy and their
finances,� Loeger said. �But for the second straight month, less
than half feel economic conditions are getting worse, a sign that
consumers are hopeful the worst of this economic recession has
passed.�
For more Discover U.S. Spending Monitor survey data, charts and
information, please visit
www.discoverfinancial.com/surveys/spending.shtml.
About Discover U.S. Spending Monitor
The Discover� U.S. Spending MonitorSM is a monthly index of
consumer spending intentions and capacity that is based on
interviews with a random sample of 8,200 U.S. adults conducted at a
rate of 275 per night. In addition to spending, the survey asks
consumers their opinions on the U.S. economy and their personal
finances. The Monitor began in May 2007 with a base index of 100.
Surveys are conducted by Rasmussen Reports, an independent survey
research firm (www.rasmussenreports.com).
About Discover Financial Services
Discover Financial Services (NYSE: DFS) is a leading credit card
issuer and electronic payment services company with one of the most
recognized brands in U.S. financial services. Since its inception
in 1986, the company has become one of the largest card issuers in
the United States. The company operates the Discover Card,
America's cash rewards pioneer, and offers student and personal
loans, as well as savings products such as certificates of deposit
and money market accounts. Its payments businesses consist of the
Discover Network, with millions of merchant and cash access
locations; PULSE, one of the nation's leading ATM/debit networks;
and Diners Club International, a global payments network with
acceptance in 185 countries and territories. For more information,
visit www.discoverfinancial.com.
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