Consumer Confidence: Shaky Start for '07
Jan. 9, 2007 — -- Consumer confidence is off to a shaky start in 2007, dropping from the 2006 high it reached in mid-December. It's at its lowest this week since Oct. 22.
The ABC News/Washington Post Consumer Comfort Index stands at -5 on its scale of +100 to -100, down from +1 three weeks ago. That's still better than its 2006 average, -10, and its recent low, -19, in August as gasoline prices spiked.
Excepting the period of mid-1997 to mid-2001, the index rarely has a footing in the zone of positive numbers. The index's long-term average is -9.
INDEX -- The CCI is based on Americans' ratings of the national economy, the buying climate and their personal finances. This week 37 percent of Americans say it is a good time to buy things, down from a recent high of 44 percent in late November.
Forty-four percent rate the national economy positively -- it was 48 percent, a more-than-five-year high, three weeks ago -- and 61 percent rate their personal finances positively, compared with 65 percent in mid-November, the most since August 2001.
TREND -- The slow start to 2007 follows a rally that lifted the index through the fall, from -19 on Aug. 27 to +1 in November and December. The CCI is a long way from its best days, an average of +29 in 2000, peaking at +38 in January 2000. But it's been vastly worse -- an average of -44 in 1992, bottoming out at -50 that February.
GROUPS -- As usual, the index reads higher for those better off -- far better, for example, among higher-income Americans, college graduates and whites. It's +5 among men while -13 among women. And huge partisan differences remain: The CCI is +39 among Republicans, but -15 among independents and -27 among Democrats.
Here's a closer look at the three components of the ABC/Post CCI:
NATIONAL ECONOMY -- Forty-four percent of Americans rate the economy as excellent or good; it was 45 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 -- Sixty-one percent say their own finances are excellent or good; it was 63 percent 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-seven percent of Americans say it's an excellent or good time to buy things; it was 38 percent last week. The best was 57 percent on Jan. 16, 2000. The worst was 20 percent in the fall of 1990.
METHODOLOGY -- Interviews for the ABC News/Washington Post Consumer Comfort Index are reported in a four-week rolling average. This week's results are based on telephone interviews from a random national sample of 1,000 adults in the four weeks preceding Jan. 7, 2007. The results have a three-point error margin. Field work was done 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 same 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 (everyone negative on all three measures). The survey began in December 1985.