The Bloomberg Consumer Comfort Index will be rescaled beginning with today’s report to make the gauge of U.S. sentiment easier to interpret.
The index will be presented on a scale of zero to 100 rather than the previous minus 100 to 100. The midpoint of the index will correspondingly shift to 50 from zero. The change is cosmetic and doesn’t affect the gauge’s components, their relationship to each other or their correlation with other economic indicators.
“It’s, we hope, a somewhat more accessible way of understanding the data,” said Gary Langer, president of Langer Research Associates LLC in New York, which produces the data for Bloomberg. “A zero-to-100 scale is somewhat more approachable analytically, it’s clearer conceptually.”
Historical data for the index and its components will be revised to reflect the adjustment. Analysis of trends, values and relationships among demographic groups and other variables, and their correlations with other economic indicators are unaffected by the new methodology.
Under the rebasing, the comfort index for the week ended April 20, the last available data, would have been 37.3 instead of the reported minus 25.4. The lowest reading over the past 12 months becomes 31.1 in the week ended Nov. 3 instead of minus 37.9, Langer said.
Previously, index values were produced by subtracting the net negative responses to a question from the net positive responses. The full index then was computed by averaging the three sub-index values on the economy, personal finances and buying climate.
In the revised calculation, the net positive answers to each question will represent the index value. The headline gauge will remain the average of the three components.
Field work for the survey is done by SSRS/Social Science Research Solutions of Media, Pennsylvania, which conducts telephone surveys with a random sample of 1,000 consumers ages 18 and older. Each week, 250 respondents are asked for their views on the U.S. economy, personal finances and buying climate. The survey has been conducted continuously since 1985.