Consumer Confidence Finishes a Flat February

Holding Steady After a Gyrating January

Analysis by DREW ALLEN

March 1, 2006 Consumer confidence completes a flat February this week, holding essentially steady across the month after gyrating through January.

The ABC News/Washington Post Consumer Comfort Index, now -12 on its scale of +100 to -100, has hovered between -13 and -11 all month, a respite from its four- and five-point swings last month. It now roughly matches its average for 2006 so far (-11), as well as its 2005 average, -13.

The index comes from Americans' ratings of the national economy, their personal finances and the buying climate. Last week ratings of the buying climate reached a three-month low, when just 33 percent called it a good time to spend money. It's 36 percent this week, nearer its long-term average of 38 percent in 20 years of weekly polls.

This week 39 percent rate the economy positively, and as usual more, 57 percent, say their personal finances are in good shape, which precisely matches the long-term average.

TREND The CCI overall is down from -8 at the start of the year but well up from its low last year of -23, when gas prices spiked after Hurricane Katrina. The CCI has averaged -9 since it began in late 1985, ranging from a high of +38 in January 2000 to a low of -50 in February 1992.

GROUPS As usual, confidence is higher among better-off groups. The index is +49 among higher-income Americans but -45 among those with the lowest incomes, +4 among college graduates while -48 among those who haven't finished high school and -7 among whites but -34 among blacks.

The CCI is +2 among men and -26 among women, making the gender gap the biggest of the year and larger than average.

The index remains far higher among Republicans (+28) than among Independents (-14) or Democrats (-30). Regionally, at -7 it's now best in the West, compared with -18 in the Northeast, -14 in the South and -10 in the Midwest.

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

NATIONAL ECONOMY Thirty-nine percent of Americans rate the economy as excellent or good; it was 40 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 Fifty-seven percent say their own finances are excellent or good; it was also 57 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-six 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 Feb. 26, 2006. 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.