Consumer confidence has moved up in August to its best in three months, though remaining at historically low levels.
The ABC News Consumer Comfort Index stands at -45 on its scale of -100 to +100, up 4 points in the past month and 8 points since the summer's start. But it's nonetheless been very low for very long, this week matching its average since 2008. It's much closer to its record low, -54 in January, than to its 23-year average -12, much less its highs.
Two separate, forward-looking measures point to decreasing economic pessimism. In an ABC News/Washington Post poll last week fewer than half said the current recession will last more than another year, down from 70 percent in February. And last week's CCI found 31 percent saying the economy's getting worse, the fewest in more than five years.
President Obama announced his nomination of Ben Bernanke today for a second term as chairman of the Federal Reserve, crediting him with putting "the brakes on our economic freefall" while noting that "we are a long way away from a completely healthy financial system and a full economic recovery." Unemployment remains a significant problem, at 9.4 percent, but home values are showing signs of recovery: The Case-Shiller Home Price Index released today shows the first quarterly increase in home values nationally in three years, and existing home sales in July beat those in June by the biggest one-month jump in a decade.
INDEX – The CCI is based on Americans' ratings of the national economy, their personal finances and the buying climate. Only 8 percent rate the economy positively, in single digits for 43 of the past 46 weeks and 30 points below its long-term average in weekly polls since late 1985.
Twenty-five percent say it's a good time to buy things – 2 points from the best of the year but just 7 points above the all-time low, 12 points below average and below 30 percent for a record 76 weeks.
Ratings of personal finances, typically the best of the three measures, are at their best since mid-May and up 10 points from their record low in late June. But they're still 8 points below average; fewer than a majority have rated their finances positively for 15 weeks straight and all but two weeks this year.
TREND – The index, while far from good, is its best since mid-May, having elbowed its way up 8 points since hitting the recent low of -53 in June.
Still, it's been below -40 for 70 consecutive weeks, a record, and hasn't seen positive territory since March 2007. The CCI's average so far this year is -49, 5 points below the worst annual average on record, -44 in 1992.
Its best yearlong average was +29 in 2000; its best week, +38 in January 2000.
GROUPS – The index is higher as usual among better-off Americans, but negative across the board for the 26th week straight and all but two weeks this year.
It's -31 among those with the highest incomes (3 points from the low in January) while -79 among those with the lowest (the worst since May), -33 among those who've attended college (the best since May) vs. -69 among high school dropouts, -40 among men while -49 among women, -39 among homeowners (also the best since May) compared with -57 among renters, and -45 among whites vs. -49 among blacks. The last is far different from the usual 28-point racial gap.
Partisan differences remain, but also are narrower than usual: The CCI is -37 among Republicans, -52 among Democrats and -45 among independents. That 15-point Republican-Democratic gap compares with 41 points last year and 32 points long-term.
Here's a closer look at the three components of the ABC News CCI:
NATIONAL ECONOMY – Eight 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, 2009.
PERSONAL FINANCES – Forty-nine percent say their own finances are excellent or good; it was 48 percent last week. The best was 70 percent, last reached in January 2000. The worst was 39 percent June 28 and 21, 2009.
BUYING CLIMATE – Twenty-five percent say it's an excellent or good time to buy things; it was 26 percent last week. The best was 57 percent on Jan. 16, 2000. The worst was 18 percent, last reached Oct. 19, 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 Aug. 23, 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.