Earlier this week, my colleague Christine Viets wrote about how consumers appear to be spending very cautiously this holiday season. One indication of why spenders have been wary can be seen in this month’s Middle Tennessee Consumer Outlook Index. After posting gains throughout 2013, the index dropped in December. The decline suggests that consumers in Middle Tennessee have a less optimistic view of the economy than they did in September.

The Middle Tennessee Consumer Confidence survey is conducted by the Office of Consumer Research at Middle Tennessee State University, headed by Professor Timothy Graeff. Students in Professor Graeff’s marketing research course conduct the survey by phone. The survey asks 11 questions related to economic conditions in the United States as well as Middle Tennessee.

Participants felt better about the local economy than they did about the national economy. The survey indicated that consumers in Middle Tennessee are rather pessimistic about current business conditions in the United States. Only 12 percent of respondents believe national business conditions are good, while 26 percent believe conditions are bad. Opinions about Tennessee business conditions were better, with 42 percent indicating conditions are good versus 9 percent who believe conditions are bad.

Looking forward, responses were slightly better for the U.S. economy. When asked what conditions for the United States would be like in six months, 25 percent indicated things would be better, and 25 percent felt things would be worse. For Tennessee, 27 percent expressed conditions would improve, while 11 percent stated conditions would be worse.

Historically, Middle Tennessee consumers have been more optimistic about the future of the economy than national consumers. When comparing the November Conference Board Consumer Confidence Index and the Middle Tennessee survey, Middle Tennessee consumers remain more optimistic about the future of the economy, the job market, and their personal situation.

Importantly, even though the Middle Tennessee consumer outlook declined, it is still more positive than negative, suggesting that people will still be visiting malls and outlet stores in the area and that consumers in Middle Tennessee may buck the national trend.

By Troy Balthrop, a Regional Economic Information Network analyst in the Atlanta Fed’s Nashville Branch