Consumer Sentiment

RECENT NEWS
MarketWatch  Dec 12  Comment 
A big pickup in consumer sentiment in December is yet another sign of a U.S. economy returning to normal.
Bloomberg  Dec 12  Comment 
Americans brimmed with confidence in early December as they shopped for holiday gifts, signaling retailers will see sales continue to accelerate heading into 2015.
MarketWatch  Dec 12  Comment 
Consumer sentiment is strongest in nearly 8 years: University of Michigan
Yahoo  Dec 12  Comment 
U.S. consumer sentiment rose in December to a near eight-year high on improved prospects for jobs and wages and on lower gasoline prices, a survey released on Friday showed. The Thomson Reuters/University ...
WA Business News  Dec 10  Comment 
A slump in consumer sentiment and fears commodity prices will continue to tumble have driven the Australian share market lower.
The Australian  Dec 9  Comment 
AUSTRALIAN consumers are the gloomiest they have been in three years, survey data released this morning shows.
MarketWatch  Dec 7  Comment 
With gas prices at multiyear lows and consumer sentiment at multiyear highs, retail sales data will likely be the main catalyst for stocks this week.
The Economic Times  Dec 5  Comment 
Consumer sentiment had picked up in the run up to the general election earlier in the year, but has failed to maintain the momentum.
The Economic Times  Dec 4  Comment 
Consumer sentiment and optimism has come in since the new government in India and that bolsters their desire to travel, says Thompson.
Clusterstock  Nov 26  Comment 
NEW YORK (Reuters) - U.S. consumer sentiment rose in November to its highest level in more than seven years on improvements in the current economic condition, including lower gas prices and improving job prospects, a survey released on Wednesday...




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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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