The IBD/TIPP Economic Optimism Index slipped to 55.3 in March, losing just a little altitude after hitting a 12-year high of 56.4 the prior month in a vote of confidence for Trumponomics.
The polling, from Feb. 24 through March 4, came as financial markets continued their impressive postelection rally, with the Dow Jones industrial average ending Friday north of 21,000. The period also included President Trump's optimistic Feb. 28 address to Congress.
"Since my election, Ford (F), Chrysler (FCAU), General Motors (GM), Sprint (S), Softbank, Lockheed (LMT), Intel (INTC), Wal-Mart (WMT), and many others have announced they will invest billions and billions of dollars in the United States, and will create tens of thousands of new American jobs," Trump said in the speech. Just how much credit Trump deserves, if any, for those job announcements is far from clear.
General Motors, Intel and Wal-Mart are all Dow components.
The Economic Optimism Index registered above the neutral 50 level for the sixth straight month, after signaling pessimism for 17 months from May 2015 through September 2016.
"A majority of Americans think that the economy is improving. They are also optimistic President Donald Trump will deliver on his promises such as tax cuts and less regulations, which are likely to boost U.S. employment and grow the economy," said Raghavan Mayur, president of TechnoMetrica, IBD's polling partner. "The stock market has also posted spectacular gains since he won the election."
The Economic Optimism Index is a composite of three major subindexes that track views of near-term economic prospects, the outlook for personal finances over the coming six months, and views of how well government economic policies are working.
- The gauge of the six-month economic outlook eased to 53.6 from 55.6 in February. That was actually the third straight decline from December's 56.3, though the current level still represents a huge recovery from 36.7 in July 2016.
- The personal financial outlook index dipped two-tenths of a point to 62.6 after rising in February to the highest level since October 2004.
- The measure of confidence in federal economic policies slipped 1.3 points to 49.6, just below the neutral level, after signaling optimism for the first time in a decade in February. Among rural Americans, the approval rating of federal economic policies, which had surged to the highest level since April 2003 a month ago, fell 7.1 points to a still-positive 53.6 in March.
While Trump's economic policies are getting broad support so far, there's something of a disconnect between the postelection increase in economic optimism and negative feelings about Trump's overall job performance. The IBD/TIPP Poll found that just 42% approve of the job he's doing as president, while 48% disapprove. The poll was largely completed before Trump's address to Congress last Tuesday. Of the 653 surveyed before the speech, just 39.5% approved of the job he is doing. Of the 256 polled after the speech, his approval rating climbed to 46.1% — a 6.6-point bump.
But presidential poll bumps after a big speech often fade quickly. And soon after his address, Trump stepped on that coverage with other headlines.