Economic Confidence Index Lowest Since October 2014

July's Economic Confidence Index averaged minus 12 in July, down from minus 8 in June and the lowest monthly average since October 2014. The drop is attributable chiefly to Americans' increasing view that the economy is getting worse rather than better.

After six consecutive months of improvement beginning in August 2014, the ECI averaged plus 3 in January, the first time it was in positive territory since Gallup began tracking it daily in 2008. However, the index began dropping in February as gas prices start to rise, and dropped further to minus 7 in May after reports of disappointing economic growth in the first quarter.

The U.S. saw still more erosion in Americans' economic confidence in July as the Greek economic crisis played out and the U.S. stock market reacted to it and to drops in the Chinese stock market. Confidence averaged minus 11 during the last week of the month, July 27-August 2. The current conditions component averaged minus 6 in July, slightly below the minus 4 of June. The July average was the result of 25 percent of Americans rating the current economy as "excellent" or "good" and 31 percent rating it as "poor." In July, 39 percent of Americans said the economy was "getting better," while 56 percent said it was "getting worse." This resulted in an economic outlook score of minus 17, the lowest since August 2014.

The 11-point difference between the components is one of the largest Gallup has found since May 2013. Americans briefly rated the outlook for the economy more positively than they viewed the current economy from December 2014 through February 2015. But since March, Americans have grown increasingly negative about the economy's outlook, while their views of current conditions have soured only slightly.

A number of factors may be affecting how Americans view the direction of the country's economy, including unsettled economic conditions in Europe and in China and the volatility of the U.S. stock market. All of these could be making Americans -- particularly those with higher incomes -- more pessimistic. Although upper-income Americans remain more positive than lower- and middle-income earners about the economy, the gap between the two groups narrowed in July as economic confidence among upper-income Americans was negative for the first time in 10 months.