Consumer sentiment weakened in September as the RealClearMarkets/TIPP Economic Optimism Index, the first read on U.S. consumer confidence each month, fell from 50.9 in August to 48.7, a 2.2-point decline (-4.3%). After briefly breaking a five-month streak of pessimism in August by rising above the neutral 50.0 mark, the index slipped back into negative territory.
September’s Economic Optimism Index reading of 48.7 is 0.93% below its 296-month historical average of 49.2.
Investor confidence fell 4.0% (2.6 points) to 62.5 in September, while non-investor confidence declined 3.7% (1.6 points) to 41.9.
August’s reading for investors had marked a 48-month high, the strongest since August 2021. The confidence gap between investors and non-investors now stands at 20.6 points.
The RCM/TIPP Economic Optimism Index has a strong track record of predicting the confidence indicators later released by the University of Michigan and The Conference Board. From February 2001 to October 2023, TIPP released this index monthly in collaboration with its former sponsor and media partner, Investor's Business Daily.
RCM/TIPP surveyed 1,362 adults for the September index from August 27 to August 29. The online survey used TIPP's network of panels to obtain the sample.
The index is measured on a scale from 0 to 100. Readings above 50 indicate optimism, while those below 50 signal pessimism. A score of 50 is neutral.
The RCM/TIPP Economic Optimism Index has three key components. In September, all of them declined.
- The Six-Month Economic Outlook, which measures how consumers perceive the economy's prospects in the next six months, dropped 1.3%, from 46.1 in August to 45.5 in September.
- The Personal Financial Outlook, a measure of how Americans feel about their own finances in the next six months, declined by 4.1% from its previous reading of 55.7 in August to 53.4 this month.
- Confidence in Federal Economic Policies, a proprietary RCM/TIPP measure of views on the effectiveness of government economic policies, weakened to 47.3 this month from 50.8 in August, reflecting a 6.9% decline. This component crossed above the neutral 50.0 mark for the first time in August, ending a 47-month streak in pessimistic territory that began in September 2021.
RCM/TIPP also releases a companion measure, the Financial-Related Stress Index, the only monthly metric tracking Americans’ financial stress.
The index dropped 0.3 points (0.5%) from 65.6 in August to 65.3 in September, echoing a slight easing of financial stress among Americans.
The higher the number, the more stress. Readings above 50 signal increased stress, while those below 50 indicate lower stress; a reading of 50 is considered neutral. For context, the last time the index posted below 50.0 was before the onset of the pandemic in February 2020, when it stood at 48.1.
The index has averaged 60.4 since December 2007. September’s reading of 65.3 exceeds this by 8.1%, signaling heightened financial stress relative to the long-term average.
"It's said here with great frequency that consumption is an effect of production. It's worth thinking about amid a swoon after such impressive RCM/TIPP gains the previous month. It's not foolproof, but at times it's hard not to conclude that volatility in RCM/TIPP reflects broader volatility in the interventionist qualities of the man in the White House. The natural state of man is to produce, but there are barriers to production presently being erected all around us in concert with the extraordinary volatility of those barriers,” said John Tamny, the editor of RealClearMarkets.
“Americans’ economic confidence weakened in September, slipping back into pessimistic territory after a brief one-month rebound in August,” said Raghavan Mayur, president of TechnoMetrica, which conducted the survey. “Concerns about inflation and the impact of tariffs remain high, with food prices standing out as the leading economic worry.”
Economic Optimism Index Breakdown
This month, 7 of the 21 demographic groups tracked by RCM/TIPP, including age, gender, race, and education, are in positive territory, with scores above 50 on the Economic Optimism Index. For comparison, there were 10 in August, six in July, and seven in June. Three groups improved on the index, compared to 20 in August, 10 in July, and 18 in June.
For the Six-Month Economic Outlook component, five of the 21 groups tracked by RCM/TIPP scored in optimistic territory, compared to five in August, five in July, and another five in June. Economic Outlook sentiment improved for nine groups, compared to 21 in August, nine in July, and 17 in June.
For the Personal Financial component, 12 of the 21 groups tracked by RCM/TIPP were optimistic, compared to 17 in August, 16 in July, and 13 in June. Six groups rose compared to 20 in August, nine in July, and 16 in June.
For the Federal Policies component, five of the 21 groups are above 50.0, compared to eight in August, six in July, and eight in June. One of the twenty-one groups rose compared to 21 in August, six in July, and 15 in June.
Release schedule for the balance of 2025
- Oct 2025: Tuesday, October 7
- Nov 2025: Tuesday, November 4
- Dec 2025: Tuesday, December 2
About TechnoMetrica/TIPP
TIPP is the polling unit of TechnoMetrica, a nationally renowned survey research and market research firm dedicated to providing clients with expert data-driven analysis to facilitate informed decision-making in their businesses. The TIPP Poll is considered the gold standard survey, having the unique distinction of being the most accurate presidential poll in the past six election cycles. The tippinsights unit provides editorials and commentaries on national and international issues, often appearing on the RealClearPolitics website.
About RealClearMarkets
RealClearMarkets (RCM) is a one-stop shop for market-related news, analysis, and commentary. RealClearMarkets collects and publishes business, finance, and economic content from across the ideological spectrum. Site features include Market Data, Off the Street Blogs, Quotes, Research Reports, Videos, Topics, and Facts & Fallacies.
RealClearMarkets falls underneath the umbrella of RealClear Media Group's (RCMG) brands, sites that span a spectrum of passions and interests. Visit realclearmediagroup.com
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