Confidence Edges Lower But Not All That Low

Transcription

1 ABC NEWS/MONEY MAGAZINE CONSUMER INDEX 8/8/4 EMBARGOED FOR RELEASE AFTER 6:3 p.m. Tuesday, August 1, 24 Confidence Edges Lower But Not All That Low Consumer confidence edged lower this week for the first time in the last two months. But it's still not low far closer to its best of the year than its worst, and even with its longterm average in the 18-year-old ABC News/Money magazine poll. The ABC/Money Consumer Comfort Index stands at -9 on its scale of +1 to -1, down from -6 last week. That's its first dip since mid-june, but still far better than its level two months ago, -2. Its high for the year was -3 in mid-january. The job market bears close watching. In conflicting Labor Department data last week, a survey of employers suggested an anemic gain of 32, jobs in July, while a survey of households indicated a gain of 629, jobs. The two differ in how they count jobs. While economists tend to prefer the employer survey, the household survey may provide a better window on public attitudes. (The ABC/Money poll has a high long-term correlation of.7 with the nation s employment rate, derived from the household survey.) Consumer Confidence /11/4 1/25/4 2/8/4 2/22/4 3/7/4 3/21/4 4/4/4 4/18/4 5/2/4 5/16/4 5/3/4 6/13/4 6/27/4 7/11/4 7/25/4 8/8/4

2 The Federal Reserve raised interest rates a quarter-point today, noting that "the pace of improvement in labor market conditions has slowed," but also that "the economy nevertheless appears poised to resume a stronger pace of expansion going forward." Gasoline prices are another factor in consumer confidence, and while crude oil prices have spiked lately, gasoline remains lower than its late-spring and early-summer highs an average $1.88 per gallon this week, compared with $2.6 in late May. INDEX The ABC/Money index is based on Americans ratings of the economy, their personal finances and the buying climate. This week 39 percent say the economy's in good shape, as many call it a good time to buy things, and most, 58 percent, rate their own finances positively. All are at or within one point of their long-term averages in weekly surveys since December ABC News/Money magazine poll Positive ratings of: This week Last week 24 avg. 18-yr. avg. National economy 39% Buying climate Personal finances Consumer Comfort Index TREND After dropping to -2 on June 13, the ABC/Money index soared 12 points in three weeks, held stable throughout July and reached its best level since early February last week, before inching lower this week. Its average for the year is -12. The index has been as high as +38 in January 2 and as low as -5 in February Its worst annual average was -44 in Last year it averaged -19, its worst year since ABC/Money Index Today -9 Last week -6 Recent low -2 Eight weeks ago Recent high -3 January average -12 To date 23 average average average +4 2 average +29 Best full year 1992 average -44 Worst full year Jan. 16, Record high Feb. 9, Record low Average since 12/85-9

3 4 3 2 Consumer Confidence Index Weekly Tracking Results Since December 1985 Record High 1/16/ Recession starts 3/ Recession starts 7/ /8/ /8/ /8/ /8/ /8/ /8/199 12/8/ /8/ /8/ /8/ /8/ /8/ /8/ /8/ /8/ /8/2 12/8/21 12/8/22 12/8/23 GROUPS Confidence, as usual, is best among better-off Americans. The index is +34 among higher-income people while -58 among those with the lowest incomes. It s +8 among college graduates while -55 among high-school dropouts, -2 among whites but -53 among blacks and among men while -18 among women. The index remains hugely divided by party lines: It s +33 among Republicans, -7 among independents and -41 among Democrats. Regionally, it's best in the Midwest (-1) and worst in the Northeast (-19). Here's a closer look at the three components of the ABC/Money index: NATIONAL ECONOMY Thirty-nine percent of Americans rate the nation's economy as excellent or good; it was 41 percent last week. The highest was 8 percent on Jan. 16, 2. The lowest was seven percent in late 1991 and early Pos. NET Excel. Good Neg. NET Not good Poor This week Avg. since 12/ PERSONAL FINANCES Fifty-eight percent rate their own finances as excellent or good; it was 59 percent last week. The best was 7 percent on Aug. 3, 1998, and matched in January 2. The worst was 42 percent on March 14, Pos. NET Excel. Good Neg. NET Not good Poor This week Avg. since 12/

4 BUYING CLIMATE Thirty-nine percent say it's an excellent or good time to buy things; it was 41 percent last week. The best was 57 percent on Jan. 16, 2. The worst was 2 percent in fall 199. Pos. NET Excel. Good Neg. net Not good Poor This week Avg. since 12/ Positive Ratings of Individual Gauges Since December Personal Finances Buying Climate 3 2 National Economy 1 2/23/86 8/24/86 2/22/87 8/23/87 2/21/88 8/21/88 2/26/89 8/27/89 2/25/9 8/26/9 2/24/91 8/25/91 2/23/92 8/23/92 2/21/93 8/22/93 2/2/94 8/21/94 2/19/95 8/2/95 2/18/96 8/18/96 2/16/97 8/17/97 2/15/98 8/16/98 2/14/99 8/15/99 2/13/ 8/13/ 2/11/1 8/12/1 2/1/2 8/11/2 2/9/3 8/3/3 2/8/4 8/8/4 METHODOLOGY - The ABC News/Money magazine Consumer Comfort Index represents a rolling average based on telephone interviews with a random sample of about 1, adults nationwide each month. This week's results are based on 1, interviews in the four weeks ending Aug. 8, 24, and have an error margin of plus or minus three percentage points. Field work by ICR-International Communications Research of Media, Pa. The ABC/Money index is derived by subtracting the negative response to each index question from the positive response to that question. The three resulting numbers are then added and divided by three. The index can range from +1 (everyone positive on all three measures) to -1 (all negative on all three measures). The survey began in December Analysis by Dalia Sussman. ABC News polls can be found online at Media contact: Cathie Levine, (212) or Lisa Finkel, (212)

5 8/8/4 This Last 4 Wks 3 Mo. 1 Yr. 12 Mo 12 Mo 12 Mo Week Week Ago Ago Ago High Low Avg Group GENERAL POPULATION: Overall Index State of Economy Personal Finances Buying Climate OVERALL INDEX BY DEMOGRAPHIC GROUPS Sex: Men Women Age: Income: Under $15K $15K To $24.9K $25K To $39.9K $4K To $49.9K Over $5K $5K To $74.9K N/A N/A N/A N/A N/A $75K To $99.9K N/A N/A N/A N/A N/A Over $1K N/A N/A N/A N/A N/A Region: Northeast Midwest South West Race: White Black Politics: Republican Democrat Independent Education: < High School High Sch. Grad College Home: Own Rent Marital Status: Single Married Sep/Wid/Div Employ. Status: Full-Time Part-Time Not Employed