Confidence Edges Down

Consumer confidence has edged slightly lower in the last two weeks, moving back toward its low for the year despite easing gasoline prices.

The ABC News/Washington Post Consumer Comfort Index now stands at -21 on its scale of +100 to -100, down from -17 two weeks ago and well below both its 2005 average, -13, and its nearly 20-year average, -9.

Gas prices continue to fall from their post-Katrina peak, down 12 cents this week to less than $2.50 a gallon for the first time since early August. But with inflation indicators up, the Federal Reserve raised interest rates today to their highest level in more than four years.

Slippage in the ABC/Post index in the past two weeks occurred in consumers' ratings of their finances and the buying climate. Ratings of the nation's economy, while soft, have held steady.

INDEX -- These three gauges comprise the weekly ABC/Post index. This week 55 percent say their own finances are in good shape, three points below the 2005 average. Fewer, at 31 percent, call it a good time to buy things, five points below the average for the year. About as many, 33 percent, say the economy is in good shape, four points off the average for the year.

TREND -- At -21, the index is close to its low for the year, -23 on Sept. 18; it's given up four of the six points it gained from mid-September to mid-October.

GROUPS -- As usual, the CCI is higher in better-off groups. It's +30 among higher-income Americans while -41 among those with the lowest incomes, -9 among college graduates while -42 among those who haven't finished high school and -18 among whites but -42 among blacks. The index is -36 among women, the lowest since March 2003, compared with -3 among men.

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

NATIONAL ECONOMY -- Thirty-three 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 seven percent in late 1991 and early 1992.

PERSONAL FINANCES -- Fifty-five percent say their own finances are excellent or good; it was 56 percent last week and 58 percent two weeks ago. 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; it was 33 percent 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 Oct. 30, 2005. The results have a three-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.

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

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