U.S. economic sentiment rebounded into optimism in November, according to a report from Investor's Business Daily and TechnoMetrica Market Intelligence. The IBD/TIPP index of economic optimism gained nearly 10 points to 50.8, representing the biggest one-month gain in the eight-year history of the index.
Each of the three subcomponents saw improvement in the month, led by a sharp increase in the component looking at the economic outlook, which advanced to 55.4 from a previous 41.9 reading.
The personal financial outlook index also saw a 10-point gain to 60.6, following a four-point drop in the previous month.
Only the component looking at federal policies remains below 50, indicating a pessimistic outlook from consumers. That index was at 36.4 in November, up from 30.9 in October, which was a cyclical low.
Overall, the headline index is 8.9 points above its 12-month average, though it is also 0.8 points below its all-time average.
"Consumer confidence made big gains this month on the back of falling gasoline prices, the government's economic rescue and stabilization plan, and even hope regarding the November election," said Raghavan Mayur, president of TIPP.
Mayur added that the polls were taken before the dismal employment report was released last Friday.
The survey's margin of error is 3.3%. A reading above 50 signals indicates an optimistic outlook while below 50 suggests pessimism.
By Patrick McGee and edited by Stephen Huebl
©CEP News Ltd. 2008