After it improved slightly in January but still remained in neutral territory, Rydex AdvisorBenchmarking’s Adviser Confidence Index fell nearly 2% in February to 107.18, with 65% of advisers saying they are concerned about unemployment, and 50% pointing to the federal budget deficit.
Last month, three of the four measures comprising the index fell, the only positive reading being advisers’ 12-month economic outlook (+3.84%). Their current economic outlook came in at -6.22%, six-month outlook at -2.35% and stock market outlook -4.32%.
“While the fundamentals of the U.S. economy may improve over the next several months into summer,” said George Cheatham of American Financial Consultants, “the lack of job growth will continue to be both a psychological and material drag on the economy overall. The second big concern will be the impact of lower public spending by state and local governments and the strains it will put on the credit ratings of the various states and local governments.”
Jim Elder of Elder Ado Financial added: “The U.S. economy continues to sputter along as the politicians in Washington work on legislation to help boost jobs and more regulation to avoid future financial catastrophes.”
Meanwhile, the Conference Board Consumer Index, which had also increased in January, also fell in February, but much more sharply, falling to 46, down 15% from 53 in January.