Economic Outlook and Higher Household Spending Drives Index to
Lowest Level in 2012
RIVERWOODS, Ill.--(BUSINESS WIRE)--Sep. 5, 2012--
Economic concerns and anticipation of continued higher expenses pushed
the Discover U.S. Spending Monitor to its lowest level of the year in
August, declining 0.7 points from July to 88.6. The Monitor is a
5-year-old daily poll tracking economic confidence and spending
intentions of nearly 8,200 consumers throughout the month. August marked
the third consecutive monthly increase for those believing the economy
is getting worse.
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Highlights of Discover U.S. Spending Monitor Results
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June
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July
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August
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2012
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2012
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2012
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Discover U.S. Spending Monitor Index
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90.7
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89.3
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88.6
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U.S. Economy Improving
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29%
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28%
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26%
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Personal Finances Improving
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23%
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23%
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20%
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Economic Rating at 9-Month Low
While the number of respondents reporting the U.S. economy as poor
leveled out from June to July, 56 percent of respondents ranked the
economy as poor in August. This was the highest level since January 2012.
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Respondents with children who view the economy as poor increased 7
percentage points from July to August to 58 percent. Respondents
without children viewing the economy as poor remained unchanged at 54
percent.
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There was an 8-percentage point increase to 50 percent in the number
of consumers making $75,000 or more viewing the economy as poor. This
compared with little change for those making between $40,000 and
$75,000, poor rating declined 1 percentage point to 53 percent, and
those making less than $40,000, poor rating increased 1 percentage
point to 62 percent.
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Respondents believing the economy is getting worse increased for the
third straight month to 55 percent, up 2 percentage points from July
and 11 points from March 2012.
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In August, 54 percent of women believed the economy was getting worse,
an increase of 4 percentage points from the previous month, while 56
percent of men had the same belief, a decline of 1 percentage point.
Consumers Believing Their Personal Finances are Getting Worse Reaches
10-Month High
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Fifty-one percent believe their personal finances are getting worse,
an increase of 2 percentage points from the previous month. This is
the highest level since October 2011 when 55 percent of respondents
felt their personal finances were getting worse.
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However, there was little change in how respondents currently rate
their personal finances in August, with 34 percent rating their
personal finances as good or excellent, equal to July, 38 percent
rating them as fair, down 1 percentage point from July, and 25 percent
rating them as poor, also equal to July.
High Food and Gas Prices May be Affecting Discretionary Spending
Intentions
Of all respondents, 31 percent plan to spend more next month (an
increase of 4 percentage points from the prior month). This is the
highest number reported for August since 2008 and may reflect steadily
rising food prices and record-high national average gas prices during
the month.
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For all respondents, 44 percent expect to spend more on household
expenses such as gas and groceries in the next month, an increase of 6
percentage points from July and the highest number reported for August
since 2008.
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49 percent plan to spend less on going out to dinner or the movies in
the month ahead, an eight-month high and up 2 percentage points from
July.
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48 percent plan on spending less on home improvement purchases, up 1
point from July.
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46 percent plan on spending less on a major purchase such as a
vacation, a 2-point increase from July.
Consumers were asked for the first time in August how much they plan to
spend on back-to-school shopping, with nearly two-thirds indicating they
plan to spend less than $250 this year. Specifically, 35 percent plan to
spend less than $100, and 30 percent plan to spend between $100 and $250.
Compared to last year, 38 percent plan to spend the same on
back-to-school shopping. Thirty-two percent plan to spend less than they
did a year ago, and 29 percent plan to spend more.
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 (http://www.rasmussenreports.com).
About Discover
Discover Financial Services (NYSE: DFS) is a direct banking and 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 home loans, private
student loans, personal loans, online savings accounts, certificates of
deposit and money market accounts through its direct
banking business. Its payment
businesses consist of 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
more than 185 countries and territories. For more information, visit www.discoverfinancial.com.
Source: Discover Financial Services
Discover
Matthew Towson, 224-405-5649
[email protected]