Consumer confidence stabilized this week after a steep drop last week that erased its monthlong gains. It remains close to its long-term average -- and slightly better than it was a year ago.
The ABC News/"Money" magazine Consumer Comfort Index stands at -8 on its scale of +100 to -100, essentially the same as last week, -9, but down from -4 the week before. A five-point drop like last week’s has occurred just 23 times in 19 years of weekly polls.
The index has averaged -11 this year, just slightly below its long-term average, -9, but much better than its average of -19 last year.
INDEX -- The ABC/"Money" index is based on Americans’ ratings of the current economy, the buying climate and their personal finances. Forty-one percent rate the national economy positively; it was 40 percent last week. Thirty-nine percent call it a good time to buy things, unchanged; and 58 percent say their personal finances are in good shape; also unchanged. The finances and national economy ratings are just a point off their long-term averages, while the buying climate rating matches its average.
TREND -- The index’s 2004 peak was -3 last January; its lowest this year, -22 in March. Those compare to an all-time high of +38 in January 2000 and a low of -50 in February 1992.
As noted, the 2004 average will beat the average of -19 in 2003. The index’s best yearly average was +29 in 2000; its worst, -44 in 1992.
GROUPS -- The West -- the region that fueled last week’s drop -- improved considerably this week, gaining eight points to -13. The index is -9 in the Northeast, up six points. Counterbalancing that, however, was a drop in the index in the Midwest, which lost nine points to -19. The index in the South held essentially stable at +4.
As usual, confidence is stronger among better-off Americans. The index is +48 among higher-income people while -35 among those with the lowest incomes; +4 among college graduates while -21 among high-school dropouts; -3 among whites but -32 among blacks; and +1 among men but -16 among women.
As has been the case all year, the index is far higher among Republicans (+26), than independents (-8) or Democrats (-37).
Here's a closer look at the three components of the ABC/Money index:
NATIONAL ECONOMY -- Forty-one percent of Americans rate the economy as excellent or good; it was 40 percent last week. The highest was 80 percent on Jan. 16, 2000. The lowest was 7 percent in late 1991 and early 1992.
PERSONAL FINANCES -- Fifty-eight percent say their own finances are excellent or good; it was the same 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; unchanged from last week. The best was 57 percent on Jan. 16, 2000. The worst was 20 percent in fall 1990.
METHODOLOGY -- The ABC News/"Money" magazine Consumer Comfort Index represents a rolling average based on telephone interviews with a random sample of about 1,000 adults nationwide each month. This week's results are based on 1,000 interviews in the four weeks ending Dec. 5, 2004, and have an error margin of plus or minus three percentage points. Field work by ICR-International Communications Research of Media, Pa.
The ABC/"Money" index is derived by subtracting the negative response to each index question from the positive response to that question. The three resulting numbers are then 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.
See previous analyses in our Poll Vault.