February 5, 2021 – Consumers’ assessment of the present and future diverged in January, with expectations for the remainder of 2021 improving at the same time confidence in the present situation remained low. Future expectations gave the overall index a slight boost, from 87.1 to 89.3. The expectations index improved from 87.0 in December to 92.5 in January, but remains within its relatively narrow pandemic-period band. The Present Situation Index had reached a pandemic-period high of 105.9 in November, but has declined in both months since, to 87.2 in December and 84.4 in January.
Health concerns and the economy likely account for the index divergence. The perceived difficulty in finding jobs and the negative assessment of overall business conditions clouded consumers’ measurement of the present. While they also have yet to see the societal impact of vaccinations, this should improve as vaccine distribution ramps up in the coming months. Extensions of the eviction moratorium, the potential for additional stimulus funds, and the wider reopening of businesses expected to start shortly will all influence consumers’ view of the future.