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 Business News | February 2005 
A New New Year for US Consumer Confidence?
 Jon Cohen - ABC News
 New York - Consumer confidence has broken out of a winter slump, reversing a downward trend after reaching a three-month low last week.
The ABC News/Washington Post Consumer Comfort Index gained three points this week to -8 on its scale of +100 to -100, near its long-term average, -9, in weekly polls since late 1985. It had slipped from -5 in mid-December to -11 before this week's gain.
INDEX — The ABC/Post CCI is composed of Americans' ratings of the national economy, their personal finances and the buying climate. Thirty-nine percent now say it's a good time to buy things, compared with 36 percent last week. This measure has recovered from a six-point slide from mid-December to mid-January.
Forty-two percent rate the national economy positively, unchanged from the previous two weeks and a bit better than its 2004 average, 38 percent. As is customary, more, 57 percent say their own finances are in good shape; that matches the average.
TREND — At -8, the Consumer Comfort Index is far from its peak, +38 in January 2000, but also much better than its worst, -50 in February 1992. It averaged -11 in 2004, up from -19 in 2003.
GROUPS — The index is +35 among people with the highest incomes, compared with -45 among those with the lowest incomes; +7 among college graduates while -28 among those who haven't finished high school; -4 among whites but -40 among blacks; and -1 among men compared with -16 among women. Residents of the Northeast continue to be substantially less confident (-20) than those elsewhere in the country.
A large partisan divide — a fixture of the election year — remains: The index is +32 among Republicans, -13 among independents and -33 among Democrats.
Here's a closer look at the three components of the ABC/Post CCI:
NATIONAL ECONOMY — Forty-two percent of Americans rate the economy as excellent or good, unchanged the past two weeks. The highest was 80 percent on Jan. 16, 2000. The lowest was 7 percent in late 1991 and early 1992.
PERSONAL FINANCES — Fifty-seven percent say their own finances are excellent or good; it was 55 percent last week. The best was 70 percent on Aug. 30, 1998, matched in January 2000. The worst was 42 percent on March 14, 1993.
BUYING CLIMATE — Thirty-nine percent say it's an excellent or good time to buy things; it was 36 percent last week. The best was 57 percent on Jan. 16, 2000. The worst was 20 percent in fall 1990.
METHODOLOGY — Interviews for the ABC News/Washington Post Consumer Comfort Index are reported in a four-week rolling average. This week's results are based on telephone interviews among a random national sample of 1,000 adults in the four weeks ending Jan. 23, 2005. The results have a three-point error margin. Field work was done by ICR-International Communications Research of Media, Pa.
The index is derived by subtracting the negative response to each index question from the positive response to that question. The three resulting numbers are added and divided by three. The index can range from +100 (everyone positive on all three measures) to -100 (all negative on all three measures). The survey began in December 1985.
The Washington Post replaced Money magazine as co-sponsor of this index at the start of this year. The survey methodology remains the same.
Click HERE for PDF version with charts and data table. |
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