Consumer confidence marched forward for the third straight week to its best since October with a majority rating their personal finances positively for the first time since July.
The ABC News Consumer Comfort Index stands at -43 on its scale of +100 to -100, an 8-point gain in three weeks to its best in seven months. Despite the positive trajectory, the CCI is still in its lowest, longest stretch – below -40 for over a year – and well below its long-term average of -11.
Fifty-one percent of Americans now rate their personal finances positively, the highest in nine months. Half as many, 26 percent, call it a good time to buy things, matching its best of the year. Only 9 percent rate the national economy positively, its best since early November, but still in the dumps.
The recent uptick in confidence comes as Fed Chairman Ben Bernanke told Congress today that the economy should pull out of the current recession and start growing later this year. That should be welcome news considering the recession has lingered as long as any since the Great Depression.
In a separate ABC News/Washington Post poll last week 55 percent reported optimism about the national economy over the next year, the most since 2006. But these improved hopes can't erase the current pain of layoffs and pay cuts. Twenty-three percent said someone in their home had been laid off or lost a job in recent months and 35 percent reported a cut in work hours or pay.
INDEX – The CCI, as noted, is based on Americans' ratings of the national economy, their personal finances and the buying climate. Only 9 percent rate the economy positively, in single digits for a record 26 weeks and 30 points below average.
Twenty-six percent say it's a good time to buy things, 11 points below the long-term average and just 8 points above the record low reached in October and August.
As usual, more, 51 percent, rate their own finances positively, 5 points above the 2009 average and just 6 points below the long-term average.
TREND – The past three weeks have been good for the index: It's gained 8 points, the best three-week run since September, and it hasn't lost any ground during that stretch, a first since December.
Still, confidence is struggling. The index's average for the year so far, -49, is 38 points below its long-term average and 7 points below its 2008 average – itself the second worst on record, after 1992. The index has been below -40 for 54 consecutive weeks, a record, and hasn't seen positive territory since March 2007.
Its best yearlong average was +29 in 2000; its best week, +38 in January 2000.
GROUPS – As usual, the CCI is higher among better-off groups, but negative across groups for the tenth week straight.
It's -14 among those with the highest incomes but -67 among those with the lowest, -32 among those who've attended college vs. -67 among high school dropouts, -32 among men (the best since September) while -52 among women (the 20-point gender gap is the largest since December), -40 among homeowners compared with -49 among renters (also the best since September) and -42 among whites (the best since October) vs. -48 among blacks.
Partisan differences are unusually narrow: The index is -35 among Republicans vs. -44 among Democrats and -44 among independents. That's less of a partisan gap than for the year so far, 23 points, or last year, 41 points.
Here's a closer look at the three components of the ABC News CCI:
NATIONAL ECONOMY – Nine percent of Americans rate the economy as excellent or good; it was 7 percent last week. The highest was 80 percent Jan. 16, 2000. The worst was 4 percent Feb. 8.
PERSONAL FINANCES – Fifty-one percent say their own finances are excellent or good; it was 50 percent last week. The best was 70 percent, last reached in January 2000. The worst was 41 percent Jan. 25.
BUYING CLIMATE – Twenty-six percent say it's an excellent or good time to buy things, the same as last week. The best was 57 percent on Jan. 16, 2000. The worst was 18 percent Oct. 19, Aug. 10 and Aug. 24, 2008.
METHODOLOGY – Interviews for the ABC News 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 May 3, 2009. The results have a 3-point error margin. Field work 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.