The Optimism Meter topped 59, a two-month high, on Jan. 19, as economists raised their 2010 GDP growth forecast to 2.7%. Developed by Bloomberg BusinessWeek using data from pollster YouGov, the Meter is a proprietary measure of sentiment and expectations, economic statistics, and market forecasts. It evaluates shifts in outlook among individuals, professional investors, and economists in the areas of U.S. economic growth, jobs, equity markets, and real estate.
ECONOMIC GROWTH: ECONOMISTS LIFT GDP FORECAST
HIGHLIGHT: Bloomberg’s survey of 57 economists estimates that U.S. gross domestic product will expand by 2.7% in 2010 and 2.9% in 2011. Only 37% of respondents said they think the economy is getting worse, down from 41% one month earlier.
JOBS: NOT SO GLOOMY
HIGHLIGHT: Forty-two percent of individuals say that if they lost their job, it would be very hard to find a new one that paid as much. That’s down from 50% one week earlier. Economists predict that unemployment will average 9% in 2011, down from an average 10% in 2010.
EQUITY MARKETS: A LOT LESS VOLATILE
HIGHLIGHT: The Standard & Poor’s 500-stock index is about a third less volatile than it was one year ago. Thirty percent of individuals expect the stock market to rise over the next 12 months.
REAL ESTATE: ANYBODY’S GUESS?
HIGHLIGHT: Sixty percent of YouGov survey respondents said that they believed their homes wouldn’t lose value over the next year. One-fourth think real estate has yet to hit a bottom.