(Reuters) – Americans are more bullish on the U.S. economy and the stock market and more hopeful about falling inflation and borrowing costs than they have been in a decade or more, including in the heyday of Donald Trump’s first presidency, a Gallup poll showed on Monday.
Some 53% of Americans predicted the U.S. economy will grow over the next six months, based on telephone interviews conducted in the first two weeks of January with about 1,000 adults, Gallup said. That’s more than in any of its polls since 2005. Some 61% see stocks rising – the most since Gallup began asking the question in 2001.
About 52% of those polled see inflation rising in coming months, but that’s the smallest chunk with that view since 2003, and 33% — a record by a large margin — said they expect inflation to drop. Some 41% expect interest rates to fall, more than the 35% that expect higher borrowing costs.
The positive economic outlook is largely in line with that of many economists and policymakers at the Federal Reserve, who raised interest rates in 2022 and 2023 to fight high inflation and began cutting them late last year as inflation improved and the labor market cooled.
Most Fed policymakers see the U.S. economy growing around 2.1% this year, slower than the 2.8% pace in 2024 but above its longer-term trend; they see inflation, which measured 2.6% in December by their preferred gauge, the 12-month change in the personal consumption expenditures price index, falling to 2.5% this year, and the unemployment rate, now 4.1%, rising to 4.3% by the end of this year.
Americans did disagree over the outlook for jobs, with 38% seeing a rise in the unemployment rate, and an equal proportion seeing a decline.
But overall, says Gallup poll senior editor Jeffrey Jones, optimism is on the upswing, driven in large part — but not solely — by high Republican expectations for economic prospects under a Republican president.
Only 21% of Democrats, for instance, felt the economy would improve in coming months, versus 78% of Republicans, the poll showed. By contrast, confidence in a rising stock market was widely shared across age, gender, income, political party and education.
(Reporting by Ann Saphir; editing by Diane Craft)
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