Confidence Builder

IN an American economy whose growth rate dropped to its lowest ebb in four years in the second quarter, any good news is welcome.

One dramatic report more than filled that role last week: Americans purchased homes this year at the highest rate in 15 years. Lower mortgage rates, continuing low inflation, and rising consumer confidence no doubt contributed to the remarkable jump in home ownership.

Existing-home sales grew at a strong 6.5 percent in June, more than twice the rate analysts expected. Sales rose in all regions of the country. California, which has been mired in a housing recession, saw a particularly important rise of 8.4 percent. (A rising California economy is crucial to President Clinton, not to mention Gov. Pete Wilson.)

The role of consumer confidence was especially significant. The Conference Board's survey of 5,000 households, which produces its Consumer Confidence Index, showed a rise in respondents saying they plan to buy cars and houses in the next six months.

That's one reason many economists see the negligible growth recorded in the second quarter (0.5 percent) as a bottoming out in the economy. If so, the worried Clinton administration - and the president's election campaign planners - can expect some welcome reports in coming months. A rising economy is any candidate's favorite plank to stand on.