California consumers are feeling a little more positive about their finances, possibly because they hope the war with Iran and expensive gasoline will end soon.<\/p>\n
My trusty spreadsheet looked at the May tally of consumer confidence from the Conference Board for California, seven other states and the nation. This optimism index, derived from public surveys, showed California\u2019s statewide confidence rising 4% in May.<\/p>\n
Still, this measure of consumer confidence is 2% lower than it was in January before the war. It is also 7% below the average optimism score since 2007.<\/p>\n
Keep in mind that when consumers are nervous, they might delay certain purchases, which can slow down the overall economy.<\/p>\n
California shoppers have good reason to worry about some confusing big-picture issues. The Trump administration\u2019s \u201cAmerica First\u201d economic approach clashes with California\u2019s more global outlook. There\u2019s also uncertainty about who will be the state\u2019s next governor.<\/p>\n
On a more personal level, the war boosted gas prices past $6 a gallon and spiked inflation worries. Still, California\u2019s job market might be stronger than in other parts of the country.<\/p>\n
Contemplate these recent good vibes this way. If you look at three-month averages, California\u2019s confidence is up 7% over the past year.<\/p>\n
That\u2019s the biggest increase since March 2022, when the economy was recovering from pandemic restrictions.<\/p>\n
But if you look closer at the confidence index, you can see that shoppers are still worried about what lies ahead.<\/p>\n
California\u2019s present situation index, which measures how people feel about current conditions, rose 6% in May. That puts it flat with January\u2019s pre-war reading and 4% above the long-term average.<\/p>\n
What worries Californians most is what comes next.<\/p>\n
The expectations index, which measures how consumers feel about the future, rose 2% in May. Still, that\u2019s 3% below pre-war levels and 15% below the average.<\/p>\n
In May, people across the country were a little more worried than those in California.<\/p>\n
The U.S. consumer confidence index dropped 1% in May, but it\u2019s still 5% higher than before the war and 1% above the average since 2007.<\/p>\n
Americans\u2019 view of current conditions dropped 3% in May, unchanged since before the war and 14% above the average. Expectations for the future rose 1% in May to 11% above pre-war levels, but are still 10% below the average.<\/p>\n
Stately stats<\/p>\n
Confidence dropped in six of the seven other states tracked by the Conference Board. Here is how they ranked by one-month change:<\/p>\n
\u2013 Pennsylvania: Off 12% in May to a level that\u2019s 8% below the pre-war level of January and 2% below the 19-year average.<\/p>\n
\u2013 Ohio: Off 6% in May versus 9% below pre-war and 4% below average.<\/p>\n
\u2013 Texas: Off 3% in May versus 1% above pre-war and 9% below average.<\/p>\n
\u2013 New York: Off 1% in May versus 20% above pre-war and 36% above average.<\/p>\n
\u2013 Florida: Off 1% in May versus 4% above pre-war and 16% above average.<\/p>\n
\u2013 Illinois: Off 1% in May versus 4% below pre-war and 15% above average.<\/p>\n
\u2013 Michigan: Up 19% in May versus 9% below pre-war and 4% above average.<\/p>\n