Consumer Sentiment

RECENT NEWS
Financial Times  Aug 12  Comment 
Outlook for consumer sentiment firm despite dip in July data
newratings.com  Aug 12  Comment 
WASHINGTON (dpa-AFX) - Consumer sentiment in the U.S. has improved by less than expected in the month of August, according to a preliminary report released by the University of Michigan on Friday. The report said the consumer sentiment index...
MarketWatch  Aug 12  Comment 
U.S. consumer sentiment on rise even with wage gains slower and expenses up
Benzinga  Aug 12  Comment 
The September U.S. Dollar Index is trading at 95.39, down 0.44. The U.S. Dollar Index is trading choppy and a little above the session lows. Market talk about economic data and global headline news is constant. The University of...
newratings.com  Aug 11  Comment 
WASHINGTON (dpa-AFX) - The dollar trading modestly higher against all of its major rivals Thursday afternoon. Weekly jobless claims data was largely in line with expectations this morning, while import prices showed an unexpected increase....
Mondo Visione  Aug 10  Comment 
Consumer sentiment in Russia improved further in July, moving back to levels seen before the series low recorded in May.   The MNI Russia Consumer Sentiment Indicator increased 5.4% to 71.3 in July from 67.6 in June. Sentiment is now 0.7%...
The Economic Times  Aug 8  Comment 
Expected personal finances fell 4.2 per cent to a five -month low of 110.3 in July, while the current personal finances indicator was down 2.1% to 104.4.
Mondo Visione  Aug 8  Comment 
Indian consumer sentiment fell in July in a broad based deterioration which saw lower optimism towards personal finances, the business environment, employment and the real estate market. The MNI India Consumer Sentiment Indicator decreased...
newratings.com  Aug 3  Comment 
WASHINGTON (dpa-AFX) - The dollar is down slightly against all of its major rivals Wednesday afternoon. The lack of U.S. economic data is keeping many investors on the sidelines today. Investors are playing it cautious ahead of the release of the...




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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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