Consumer Confidence Slips Below Average
NEW YORK, Oct. 6, 2004 -- -- Consumer confidence lost a bit of ground this week, slipping below its long-term average to its lowest level in more than three months.
The ABC News/"Money" magazine Consumer Comfort Index now stands at -12 on its scale of +100 to -100, down from -9 last week and -7 three weeks ago to its lowest since June 20. Confidence had hovered between -6 and -11 since late June.
Rising oil prices may be playing a role in its recent slide. The average price for a gallon of regular gasoline is $1.94 this week, according to the Department of Energy, up 9 cents in the last month -- and the highest since late June.
While confidence has been consistently much lower among Democrats than Republicans this election year, the recent dip has been bipartisan: The index is down nine points among Democrats and 10 points among Republicans in the last month. It’s changed little among independents in that time.
INDEX -- The index is based on Americans’ views of the national economy, their personal finances and the buying climate. This week 34 percent rate the economy positively, six points off the long-term average and the fewest since mid-June. Thirty-eight percent call it a good time to buy things, about average; and 60 percent say their own finances are in good shape, three points above average.
TREND -- The ABC/"Money" index peaked early this year, reaching -3 in mid-January. It dropped to its worst of the year, -22, in mid-March, but then rebounded throughout the spring. It fell to -20 in mid-June and recovered again, running in a fairly narrow band between -6 and -11 before slipping to -12 this week.
The index has ranged from a high of +38 in January 2000 to a low of -50 in February 1992. Its worst annual average was -44 in 1992. Last year it averaged -19, much worse than the best yearly average of +29 in 2000. This year so far it’s averaged -12.
GROUPS -- Confidence, as usual, is stronger among better-off Americans. The index is +24 among higher-income people while -45 among those with the lowest incomes, +2 among college graduates while -40 among high-school dropouts, -9 among whites but -28 among blacks and -2 among men but -20 among women.
Here's a closer look at the three components of the ABC News/"Money" index:
NATIONAL ECONOMY -- Thirty-four percent of Americans rate the U.S. economy as excellent or good; it was 36 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 percent say their own finances are excellent or good; it was 61 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-eight percent say it’s an excellent or good time to buy things; 39 percent said so last week. The best was 57 percent on Jan. 16, 2000. The worst was 20 percent in fall 1990.
METHODOLOGY -- The ABC News/"Money" magazine Consumer Comfort Index represents a rolling average based on telephone interviews with a random sample of about 1,000 adults nationwide each month. This week's results are based on 1,000 interviews in the four weeks ending Oct. 3, 2004, and have an error margin of plus or minus three percentage points. Field work was conducted by ICR-International Communications Research of Media, Pa.
The ABC News/"Money" index is derived as follows: The negative response to each index question is subtracted from the positive response to that question. The three resulting numbers are then 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.
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See previous analyses in our Poll Vault.