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The number of consumers who said they believe the economy is improving continued to grow in May, marking three consecutive monthly increases, according to new survey data Discover Financial Services released today.
The Riverwoods, Ill.-based company's U.S. Spending Monitor last month rose 2 points to 86.2, the highest the index has been since September. The index was set at 100 when Discover introduced it in May 2007.
Some 27% of consumers surveyed in May said they believed the economy is getting better, five points higher than in April. Conversely, 49% of those surveyed said they thought conditions were getting worse, down from 51% in the previous month. May is the first time less than half of the survey respondents were pessimistic about their economic outlook, according to the survey results.
"Consumers are feeling the economy is on the mend and their finances are improving, two things needed to revive consumer spending," Julie Loeger, Discover's senior vice president of brand and product management, said of the survey results. "But just when economic conditions appear to be getting better, rising gas prices may give consumers a reason to continue cutting back on their discretionary spending intentions."
Anticipated discretionary purchases, such as dining out and going to the movies, remained largely unchanged, increasing less than a point to 10% in May. Nearly half, 49%, of consumers said they still plan on cutting back on these expenses, a decrease of less than a percentage point from April.
