Consumer confidence

RECENT NEWS  12 hrs ago  Comment 
BERLIN (dpa-AFX) - Germany consumer confidence is set to improve in August to the highest level recorded since December 2006, survey data from market research group GfK showed Friday. The forward-looking consumer sentiment index rose to 9 in...  Jul 23  Comment 
COPENHAGEN (dpa-AFX) - Denmark's consumer confidence rose for the fifth month in a row in July as economic expectations continued to improve, a report from Statistics Denmark showed Wednesday. The headline consumer confidence index rose to...  Jul 23  Comment 
CANBERA (dpa-AFX) - The euro fell against the other major currencies in the Asian session on Wednesday, as traders await Eurozone's consumer sentiment index for July, due later in the day. Economists expect the reading to remain in negative...
The Economic Times  Jul 22  Comment 
As per a global consumer confidence index study by Nielsen, India which was ranked second in the first quarter of 2013 is now the most optimistic country.  Jul 22  Comment 
BEIJING (dpa-AFX) - Global consumer confidence increased in the second quarter to reach the highest levels since the first quarter in 2007 as job optimism improved, results of a survey by Nielsen showed Tuesday. The Nielsen Global Consumer...
WA Business News  Jul 22  Comment 
Consumers appear to have shaken off their budget cut woes, with confidence levels rebounding solidly.  Jul 21  Comment 
LONDON (dpa-AFX) - U.K. consumer confidence declined in June for the first time in 2014, according to Lloyds Bank Spending Power Report, published on Monday. The overall consumer confidence index fell by a percentage point to 145 in...
Yahoo  Jul 21  Comment 
One measure of consumer confidence in Britain fell for the first time this year in June, the latest sign of a cooling in sentiment about the country's economic recovery. The overall index of consumer confidence compiled by Lloyds Bank eased one...  Jul 18  Comment 
BRUSSELS (dpa-AFX) - The Reuters/University of Michigan's preliminary consumer sentiment index for July is due at 9:55 am ET Friday. Ahead of the data, the greenback showed mixed trading against its major rivals. While the greenback held...
Clusterstock  Jul 18  Comment 
The University of Michigan's preliminary read on consumer sentiment in July was a bit disappointing. The headline index slipped to 81.3 from 82.5 in June. Economists estimated the headline index would climb to 83.0. The economic conditions...


Consumer confidence is a term for consumers' level of optimism about the economy. It is used to capture people's perception, rather than the actual state, of the economy. Consumer confidence affects consumption, which accounted for 74% of the US Gross Domestic Product in the first quarter of 2008.[1] This is because people tend to adjust their spending based of expectation of the future. Factors such as changes in employment levels, increase/decrease in gasoline prices, inflation expectations and major events, e.g. terrorist attacks, hurricanes and ending a war, affects consumer confidence. Consumer confidence tends to vary from country to country.

Measures of Consumer Confidence

[[Image:Mich_cc.jpg|right|thumb|450px|University of Michigan Consumer Sentiment Index (Jan 1978- Jan 2008)[2]

Who is affected by changes in consumer confidence

Consumer confidence affects consumption, which accounted for 74% of the US Gross Domestic Product in the first quarter of 2008.[3] This is because people tend to adjust their spending based of expectation of the future. Lower consumer confidence, leads to lower overall spending and vice versa. Economists have concluded that spending on durable goods, such as cars and computers, is affected more than spending on non-durable goods, such as food -- since, consumers tend to put off the high budget items till they feel comfortable about purchasing them.[4] High consumer confidence bodes well for almost all types of businesses.

The type of businesses that are affected most by changes in consumer confidence are:

The type of businesses that are affected least by changes in consumer confidence are:


  1. Bureau of Economic analysis, Retrieved 7/30/2008
  2. Data from University of Michigan, retrieved 7/30/2008</ref two studies: The US Consumer Confidencitions for the next six months, current employment conditions, employment conditions for the next six m The University of Michigan Consumer Sentiment Index, calculated and published by the University of Michigan each month, is measured by conducting a phone survey of at least 500 households. The survey contains 50 questions focusing on three broad areas: personal finances, business conditions, and buying conditionber of 1964.<ref>[ University of Michigan Consumer Sentiment Index: Survey Information, retrieved 07/25/08]</li> <li id="_note-2">[[#_ref-2|↑]] [ Bureau of Economic analysis, Retrieved 7/30/2008]</li> <li id="_note-3">[[#_ref-3|↑]] [ Why Consumer Confidence Matters?, BBC New, Retrieved 7/20/2008]</li></ol></ref>
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