At the midpoint of 2009, consumer confidence is on pace for its worst year in 23 years of polls and suffering its lowest second-quarter average along the way.
This week, the ABC News Consumer Comfort Index stands at -51 on its scale of +100 to -100, just 3 points from its lowest on Jan. 25 and its second straight week below the dreaded -50 level. For the second quarter the index averaged -48 – the third lowest quarterly average – and the average for the year so far is -49, 5 points below the worst full year, 1992.
Confidence hit its 2009 high in mid-May, but has fallen back 9 points due to crumbling ratings of personal finances, which are at their lowest ever. The other two components of the index, ratings of the economy and the buying climate, are lower than finances but have been stable.
The weakness of the economy resonates on many fronts. The unemployment rate of 9.4 percent is the worst since 1983 and home prices, according to the Case-Shiller Index, are down 18 percent since last year. But on a slightly brighter note, gas prices declined for the first time in nine weeks to $2.64 per gallon, although they are still up nearly a dollar since the start of the year.
INDEX – As noted, ratings of personal finances, typically the best of the CCI's three measures, have bottomed out at 39 percent positive, matching their lowest for the second straight week and 18 points below average. The 13-point drop from 52 percent on May 10 is the steepest decline on record.
Ratings of the buying climate, at 26 percent positive, have hovered within a 3-point range since mid-April. It's just 1 point from the yearly average but 11 points below the long-term average.
Only 8 percent rate the economy positively, in single digits for 36 of the last 38 weeks and 30 points below average.
TREND – After nine consecutive weeks above -50 from mid-April to mid-June – the best such stretch since last summer – the index is below -50 for the second straight week, a first since February.
At -51, just 3 points from the record low, the index continues a rough 2009. Its average for the year so far, -49, is 37 points below its long-term average of -12 and 7 points below its 2008 average – itself the second worst on record. As noted, the CCI finished Q2 with the lowest second-quarter average, -48, and the third worst quarterly average – surpassed only by the previous two quarters at -50.
It's been below -40 for a record 62 weeks, and hasn't seen positive territory for over two years. It's miles below its record high, +38 in January 2000.
GROUPS – The index is higher as usual among better-off Americans, but negative across the board for the 18th straight week, as it's been for all but two weeks this year.
It's -19 among those with the highest incomes but -72 among those with the lowest, -41 among those who've attended college vs. -66 among high school dropouts, -45 among men while -57 among women (2 points from the low), -43 among homeowners compared with -69 among renters (matching last week, the worst since December) and -50 among whites (2 points from last week's low) vs. -52 among blacks (a 2-point racial gap; usually, 28 points).