Consumer Confidence Stabilizes

Consumer confidence took a breather this week, stabilizing after a sharp five-week decline.

The ABC News/Washington Post Consumer Comfort Index stands at -22 on its scale of +100 to -100, similar to last week's -23, its lowest since May 2003. It's the first time since mid-August the weekly index hasn't lost ground, capping a 16-point decline.

Economic expectations, measured separately on a monthly basis, were even worse last week -- their most pessimistic since December 1991.

Soaring gasoline prices in the aftermath of Hurricane Katrina look to have been a major drag on consumer views. While still high -- an average $2.80 a gallon -- gas is down from a peak of $3.07 three weeks ago.

The ABC/Post CCI is based on ratings of the economy, the buying climate and personal finances. This week 30 percent rate the economy positively, 10 points below the long-term average in weekly polls since December 1985. Thirty-one percent call it a good time to buy things, eight points below average. Ratings of personal finances are doing better -- 56 percent say theirs are OK, about average.

TREND -- The CCI started the year at -9 and has been as high as -7 in March, July and mid-August; it dipped to -19 in May and further, to -23, last week.

It's averaged -12 this year, compared with a long-term average of -9. The index reached an all-time high of +38 in January 2000 and an all-time low of -50 in February 1992.

GROUPS -- As usual, the CCI is higher in better-off groups. It's +18 among higher-income Americans while -62 among those with the lowest incomes, -7 among college graduates while -45 among those who haven't finished high school, -17 among whites but -47 among blacks and -11 among men while -32 among women.

The index is -25 in the South, -20 in the Northeast and Midwest and -19 in the West.

Here's a closer look at the three components of the ABC/Post CCI:

NATIONAL ECONOMY -- Thirty percent of Americans rate the economy as excellent or good, unchanged from last week. The highest was 80 percent on Jan. 16, 2000. The lowest was 7 percent in late 1991 and early 1992.

PERSONAL FINANCES -- Fifty-six percent say their own finances are excellent or good; it was 55 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-one percent say it's an excellent or good time to buy things, the same as last week. The best was 57 percent on Jan. 16, 2000. The worst was 20 percent in fall 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 among a random national sample of 1,000 adults in the four weeks ending Sept. 25, 2005. 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 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.

The Washington Post replaced Money magazine as co-sponsor of this index at the start of this year. The survey methodology remains the same.

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