The Utah Index of Consumer Sentiment (ICS), a measurement the Utah State Tax Commission uses to gauge local consumer confidence, soared eight points in January, a dramatic comeback from the fourth quarter of 1990 and an indication that the threat of war was more frightening than the real thing.
According to Tax Commission spokeswoman Janice J. Perry, Utah's ICS peaked at 89.1 in the first quarter of 1990, slid back to 87.9 and 86.1 in the second and third quarters, then plummeted to 66.9 in the fourth.At one point last year, in October when the economy and war fears combined for a massive negative effect, the index fell 20 points to 59.7.
On the heels of the successful allied air war campaign against Iraq in January, the ICS quickly moved up 8 points to end the month at 75, about on a level with January, 1989, sentiment.
The survey of Utah consumers was taken in late January by the University of Utah's Survey Research Center on behalf of the Tax Commission and the state Office of Planning and Budget. It has an error factor of plus or minus 5 percent.
The index uses a base of 100 beginning in 1966, when consumer confidence was high. When calculations are lower than 100, it is an indication that consumers are not as optimistic as they were that year.
Despite the rebound in personal finances and economic outlook indicated by the January 1991 survey, Perry said 45 percent of Utah consumers nevertheless thought it was a "bad" time to buy a major household appliance - the most negative response since the survey was launched in 1986.
Perry said recent statistical work by Tax Commission economists indicates a "significant correlation" between the ICS and retail sales two quarters later. Results are used to forecast sales and use taxes which represent 87 percent of Utah's General Fund revenues.