Ipsos-Reid CASH Index: Consumer Attitudes Stagnate at Low Level

WASHINGTON, D.C - The Ipsos-Reid CASH Index--an index of Consumer Attitudes and Spending by Household--stands at 85.1 in two surveys conducted in August, down 14.9 points from January 2002, when the index was set at 100.

Between May and July, the Ipsos-Reid CASH Index measured a dramatic tumble in consumer attitudes, particularly on expectations about the local economy and the individual's ability to invest. Attitudes about current individual finances slipped from mildly positive to neutral over the first half of the year. So far, the CASH Index has not fully recovered.

Results and index scores for the Ipsos-Reid CASH Index are compiled using rolling averages of two consecutive polls, based on a representative sample totaling 2,000 adults nationwide.

In the current August Index, there are some interesting findings:

• Local Economic Expectations. Expectations about the future of the local economy are the largest source of doubts. Since January, the percentage of Americans who believe the economy in their local area will improve in the next six months has dropped from 41% in January to 31% today; that is a slight uptick from July.

• Experience with Job Loss. Nothing focuses consumer attention on the state of the economy like layoffs that hit close to home. In the mid-March to mid-April poll, 46% said a family member or acquaintance had lost a job due to economic conditions in the previous six months. That figure has now dropped to 40%.

• Current Personal Financial Situations. Ratings of current personal finances are evenly divided between positive and negative scores. That has been the consistent pattern throughout the second and third quarters, down from the net positive scores of January and February.

Ipsos-Reid CASH Index (Ipsos-Reid Index of Consumer Attitudes and Spending by Household) August 2002

Changes Since January 2002

The margin of error for the questions on each rolling average of two consecutive surveys totaling 2000 adults is 177 2.2%. The Ipsos-Reid CASH Index comprises 10 questions, covering attitudes about the local economy now and in the future, personal finances now and in the future, comfort with making major purchases and other household purchases, confidence in job security and in the ability to save and invest for retirement or education, and job loss experience for self, friends and family in the recent past as well as job loss expectations for self, friends and family in the near future.

For more information on this release, please contact: Thomas Riehle President Ipsos-Reid US Public Affairs 202.463.7300 [email protected]