Economic optimism hit a five-year high this week, even as consumer ratings of current economic conditions reversed their recent positive trend.
A third of Americans now say they economy's improving, matching the number who say it's getting worse – the first time since January 2004 there've been as many economic optimists as pessimists. The change is striking: The number who say the economy's worsening has plummeted from 82 percent in October, a 28-year high, to 33 percent now. Optimism meanwhile has grown by 31 points.
The shift is especially striking because economic pessimists have outnumbered optimists by 21 points on average in ABC News polls since 1981. Rarely have optimists equaled pessimists, as now, or exceeded them – just 46 times in 290 individual polls. And economic optimism now stands 14 points above it long-term average.
The 33 percent who say the economy is getting worse is below a majority for the third consecutive month (a first in two years) and down 10 points just since last month. The change has a partisan tint: Optimism has risen by 35 points among Democrats and 32 points among independents since October, compared with a 14-point gain among Republicans. The increases have also been sharpest among men and younger adults.
CURRENT INDEX – Ratings of current economic conditions are another matter. The ABC News Consumer Comfort Index, based on views of current conditions, stands at -45 on its scale of +100 to -100, halting four weeks of gains and 3 points from the 2009 high, -42 last week. Current sentiment is severely depressed; the CCI is just 9 points from its worst, -54 in January, and 34 points below the index's 23-year average.
There's plenty of reason: Unemployment's 8.9 percent, the highest in 25 years. Gas prices are up 26 cents in the past month to an average of $2.31 a gallon ahead of the summer driving season. And new home construction dropped 13 percent last month.
The CCI is based on Americans' current ratings of the national economy, the buying climate and their personal finances. Only 8 percent rate the economy positively, in single digits for 30 of the last 32 weeks and 30 points below the long-term average.
Twenty-six percent say it's a good time to buy things, essentially unchanged the last five weeks, 11 points below the long-term average and just 8 points above the record low in October and August.
Positive ratings of personal finances, usually the strongest of the three measures, slipped to 48 percent this week after inching above the 50-percent mark the previous two weeks. The current measure is 9 points below the long-term average.
TREND – At -45 or better for four weeks, the index is on its best run since October – but that's hardly reason to celebrate. The CCI has been below -40 for a record 56 weeks and hasn't seen positive territory in over two years. Its average of -49 this year compares with a best yearlong average of +29 in 2000 and best week of +38 in January 2000.
GROUPS – As usual, the CCI is higher among better-off Americans, but negative across groups for the 12th straight week.