ECONOMY

Confidence climbing in Florida

 

Consumers aren’t feeling as gloomy as the gyrating stock market suggests. A UF survey shows the Sunshine State much sunnier than in `11. The good old days remain about six years behind.

dhanks@MiamiHerald.com

The economy doesn’t have Floridians quite as spooked lately.

That’s the conclusion of a surprisingly rosy University of Florida survey, which shows rising consumer sentiment in the Sunshine State. The main UF index is up 13 percent from a year ago and modestly higher from the start of 2012. That’s despite a rocky stock market and heightened fears that the United States could be heading for a double-dip recession.

“It is encouraging,’’ said Chris McCarty, head of the UF survey center that manages the confidence index. The Florida numbers were released the same day a national survey also showed consumers feeling slightly more confident than they were earlier in the year.

The rising numbers come at a crucial time for the economy, as it faces its third summer scare in as many years. As in 2010 and 2011, this year began with what looked like promising economic growth only to see the recovery stall.

Case-Shiller on Tuesday released its monthly report on local home values, and prices are up for the sixth straight month in South Florida. The 3 percent increase in May from the prior year makes this the longest stretch of price gains since the summer of 2006. That’s when South Florida saw an 83-month run of rising values end with what would be the start of the housing bust. Values remain down 48 percent from those peak levels.

Spending continues to be a bright spot, shaking off relatively weak gains in April with a strong May. Figures from Florida’s Department of Revenue show May spending in South Florida was up 6.6 percent, slightly below the 7 percent average for the year but better than April’s 5 percent gain.

The early-summer numbers don’t capture the latest spending activity or the economic anxiety that seems to be seeping out in other indicators. A European debt crisis has Wall Street on edge, along with softening corporate profits and consumer spending.

Mariolja Calderon relies on spending one sugary splurge at a time. She started her Mo’s Cakes kiosk three years ago at the Midtown Miami shopping mall. Based around her grandmother’s cinnamon bundt cakes, the cart of treats priced from a few dollars to $25 has generally done well at its streetside location. But Calderon said she’s seen business soften this summer.

“These last few months have been slow,’’ Calderon said. “For a while there, you saw a little bit of a pick-up in business and some optimism.”

UF’s confidence index actually spiked in July — from 73 to 76. But a three-month average of the index shows a steady improvement from January, when it measured 71.

McCarty, the survey director, expects confidence to take a dive once consumers realize the perils brewing in Washington as lawmakers and the White House grapple with mandatory tax hikes and spending cuts. The so-called “fiscal cliff” takes effect in January unless Washington passes a law that would reduce the deficit in other ways.

“I don’t think all of this stuff that is going to happen in January has hit home yet,’’ he said.

Read more The Economic Time Machine stories from the Miami Herald

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