Consumer confidence

RECENT NEWS
newratings.com  9 min ago  Comment 
LONDON (dpa-AFX) - Consumer confidence in the United Kingdom fell sharply in November, the latest survey from GfK revealed on Wednesday with an index score of -8. That was well shy of expectations for a reading of -4 after coming in at -3...
newratings.com  9 hrs ago  Comment 
WASHINGTON (dpa-AFX) - In welcome news for retailers going into the holiday shopping season, the Conference Board released a report on Tuesday showing a much bigger than expected jump in U.S. consumer confidence in the month of November. The...
newratings.com  Nov 29  Comment 
WASHINGTON (dpa-AFX) - U.S. stock index futures point to a slightly higher open on Tuesday after losses in the previous session. With the second estimate GDP data for the third quarter and reports on homes prices and consumer confidence slated for...
newratings.com  Nov 29  Comment 
LISBON (dpa-AFX) - Portugal's consumer confidence strengthened for a third straight month in November to its highest level in over 16 years, figures from Statistics Portugal revealed Tuesday. The consumer confidence index climbed to -10.5...
newratings.com  Nov 28  Comment 
ROME (dpa-AFX) - Italy's consumer confidence declined to a 16-month low in November, survey data from the statistical office Istat showed Monday. The consumer confidence index fell to 107.9 from 108 in October. This was the lowest reading...
newratings.com  Nov 28  Comment 
HELSINKI (dpa-AFX) - Finland's consumer confidence rose for a second straight month in November to its highest level in over five years, survey data from Statistics Finland showed Monday. The consumer confidence indicator climbed to 17.6...
Benzinga  Nov 25  Comment 
EUR/USD is trading at 1.0595, up 0.0035. The pair is trading just under the session highs. Chatter about European headline news and comments from policy makers has kept buyers and sellers active. France's INSEE reported that French consumer...
Forbes  Nov 24  Comment 
Samsung's next flagship smartphone - the Galaxy S8 - is going to have some pretty snazzy accessories when it arrive. This timely discovery should boost consumer confidence in the South Korean brand.
newratings.com  Nov 24  Comment 
BRUSSELS (dpa-AFX) - At 7:00 am ET Thursday, Germany's Gfk consumer confidence survey data is due. The forward-looking sentiment index is forecast to remain unchanged at 9.7 in December. Ahead of the data, the euro traded mixed against its...
newratings.com  Nov 23  Comment 
WASHINGTON (dpa-AFX) - Reflecting a boost in optimism following President-elect Donald Trump's surprise victory, the University of Michigan released a report on Wednesday showing an unexpected upward revision to its reading on consumer...




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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:

References

  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>[http://www.sca.isr.umich.edu/documents.php?c=i University of Michigan Consumer Sentiment Index: Survey Information, retrieved 07/25/08]</li> <li id="_note-2">[[#_ref-2|↑]] [http://www.bea.gov/national/nipaweb/TableView.asp?SelectedTable=5&FirstYear=2007&LastYear=2008&Freq=Qtr Bureau of Economic analysis, Retrieved 7/30/2008]</li> <li id="_note-3">[[#_ref-3|↑]] [http://news.bbc.co.uk/1/hi/business/1561162.stm Why Consumer Confidence Matters?, BBC New, Retrieved 7/20/2008]</li></ol></ref>
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