April 7, 2020
California consumer sentiment nosedived in the last few days of March, as the consequences of Governor Newsom’s stay at home order instituted on March 19 became apparent, according to the Chapman-CMC Consumer Sentiment Survey, which was underway during this period. Based solely on responses from March 20-26, California Consumer Sentiment declined an unprecedented 47% percent on the previous quarter to 51.5. By comparison, the 4th quarter 2019 California Index stood at 96.9.
“An index at this level is typically seen in the depths of a bad recession, such as the 2008 financial crisis. But, it usually takes six to nine months from the onset of the recession for sentiment to deteriorate this far. Having such a rapid drop in just over two weeks is new territory,” said Cameron Shelton, director of the Lowe Institute of Political Economy and McMahon Family Associate Professor of Political Economy at Claremont McKenna College.
The average for the entire survey period shows first quarter 2020 consumer sentiment declining 14.8% when compared to the 4th quarter of 2019, declining from 96.9 to 82.6. Sentiment among those responding in the last week of the survey window (March 20-26) was 44% lower than sentiment among those responding in the first week of the survey (March 5-7). The California Index is based on a survey of 2,000 households from across the state regarding business conditions and their personal financial position.
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