Consumer Sentiment

RECENT NEWS
Mondo Visione  Sep 26  Comment 
Consumer confidence posted a healthy September gain due to more favorable prospects for the domestic economy as well as more favorable personal income expectations. The September reading, the second highest in the last seven years, points toward...
MarketWatch  Sep 26  Comment 
The final September reading on the University of Michigan/Thomson Reuters consumer sentiment index remained steady at the preliminary reading of 84.6, according to reports on the data released Friday. This is the highest level since July 2013 and...
newratings.com  Sep 26  Comment 
BRUSSELS (dpa-AFX) - German import price figures for August and GfK consumer sentiment for October are due at 2:00 am ET Friday. Import prices are estimated to drop 2 percent year-over-year in August following the 1.7 percent decline in July. On a...
Wall Street Journal  Sep 25  Comment 
Ahead of the Tape: Changes in consumer sentiment are positively correlated with future changes in broader economic conditions and the stock market. But the nature of these relationships is less obvious.
newratings.com  Sep 22  Comment 
BRUSSELS (dpa-AFX) - The UK market is trading lower on Monday, following weak cues from Asia, ahead of the Chinese manufacturing data due on Tuesday. Miners were particularly under pressure, and shares of supermarket chain Tesco declined on a...
newratings.com  Sep 22  Comment 
BRUSSELS (dpa-AFX) - Euro Area consumer confidence and Italian industrial orders data are among a few economic data scheduled for release on Monday. At 10 am ET, the European Commission is expected to release its preliminary consumer sentiment...
The Hindu Business Line  Sep 17  Comment 
Companies out to make the most of the positive consumer sentiment
newratings.com  Sep 17  Comment 
WASHINGTON (dpa-AFX) - Trading in the U.S. index futures suggests that Wall Street stocks may open Friday's session slightly higher. Earlier in the global trading day, Asian stocks closed lower, with the exception of China, after...
Gold Stocks Today  Sep 13  Comment 
After closing within three points of the all time high last week, the market went into a choppy pullback mode this week. For the week the SPX/DOW were -1.0%, the NDX/NAZ were -0.4%, and the DJ World index was -1.4%. On the economic front, reports...




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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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