Consumer Sentiment

RECENT NEWS
Mondo Visione  6 hrs ago  Comment 
Consumer confidence rose to the highest since November last year, led by more optimistic expectations for future business conditions while sentiment towards spending took a backseat.   The MNI India Consumer Sentiment Indicator rose 2% to...
The Economic Times  10 hrs ago  Comment 
Subdued consumer sentiment and Patanjali Ayurveda seem to have impacted demand for HUL’s products in the March quarter.
Reuters  May 9  Comment 
* CEO on conf call- "In the macro environment, consumer sentiment is strong and disposable personal income continues to rise"
newratings.com  May 3  Comment 
BRUSSELS (dpa-AFX) - Swiss consumer confidence eased slightly in April, survey results from the State Secretariat for Economic Affairs showed Tuesday. The consumer sentiment index fell marginally to -15 in April from -14 in January. It was...
newratings.com  Apr 29  Comment 
WASHINGTON (dpa-AFX) - The dollar is adding to yesterday's losses against the Euro and the Japanese Yen following the release of some weaker than expected U.S. economic data this morning. Consumer sentiment, personal spending and the Chicago...
Wall Street Journal  Apr 29  Comment 
A closely watched gauge of U.S. consumer sentiment—the University of Michigan consumer-sentiment index—continued to decline in April, the latest evidence of growing worry about the economy’s momentum.
newratings.com  Apr 29  Comment 
WASHINGTON (dpa-AFX) - Reflecting weakening expectations for future growth, the University of Michigan released a report on Friday showing that U.S. consumer sentiment deteriorated by more than previously estimated in April. The report said the...
MarketWatch  Apr 29  Comment 
Consumer sentiment falls in April as fears grow
newratings.com  Apr 27  Comment 
WASHINGTON (dpa-AFX) - As expected, the Federal Reserve on Wednesday made no change to monetary policy in light of disappointing recent economic data. "Economic activity appears to have slowed," the Federal Open Market Committee said in a...
Mondo Visione  Apr 27  Comment 
Chinese consumer sentiment eased slightly in April, although improvements across a range of spending gauges in the survey point to a better outlook for retail sales and consumption expenditure in general.   The Westpac MNI China Consumer...




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Consumer sentiment is the measurement of consumers' attitudes towards their financial positions and the present situation as well as expectations of the economic conditions.[1] Similar to consumer confidence, consumer sentiment is directly related to consumer spending. Since consumer spending accounts for almost two-third of U.S GDP, the level of consumer sentiment then becomes a key indicator to gauge the health of the economy.

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Consumer Sentiment [2]

Measures of consumer sentiment

Michigan Consumer Sentiment Index (MCSI)

Consumer sentiment is measured using the Michigan Consumer Sentiment Index (MSCI). The report is released twice a month from data collected from telephone surveys conducted with 500 U.S consumers. The survey is carried out by the University of Michigan and queries in the survey include consumers' financial situation and attitudes about the economy. Approximately 60% of total survey results are released in the preliminary report on the 10th of each month whereas the final report for the prior month is released on the first of the month.[3]

Why is it important?

The pattern in consumer attitudes has the foremost influence on both the stock and bond markets. Consumer sentiment figure impacts the stock market positively when sentiment is up, and negatively when sentiment is down. The industry that is most affected by consumer sentiment is the retail industry, as their profits are directly affected by consumer spending. In 2007, the credit crunch and spiking gasoline prices drove down consumer sentiment to record lows. However, as the index began to increase again in 2008, it helped investors to confirm that the economy is easing out of recession.[4]

See also: Consumer Confidence

References

  1. ForexForum: Forex Glossary
  2. Iacono Research
  3. Investopedia: Michigan Consumer Sentiment Index
  4. Econoday: 2010 Economic Calendar


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