Consumer Sentiment

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newratings.com  Aug 28  Comment 
WASHINGTON (dpa-AFX) - The dollar is trading modestly higher against all of its major competitors on Friday, extending its gains from the previous three sessions. U.S. economic data was largely weaker than expected at the end of the week. Readings...
Yahoo  Aug 28  Comment 
U.S. consumer spending rose in July as households stepped up automobile purchases, offering further evidence of strength in the economy that keeps the door open to a Federal Reserve interest rate hike this year. While other data on Friday showed...
Yahoo  Aug 28  Comment 
Plummeting stock prices have taken a toll on U.S. consumer confidence, though there are signs the setback may be temporary. The University of Michigan says its consumer sentiment index fell to 91.9 this ...
Yahoo  Aug 28  Comment 
U.S. consumer sentiment fell in August, a survey released on Friday showed. The University of Michigan's final August reading on the overall index on consumer sentiment came in at 91.9, down from 93.1 in July. It was lower than the survey's...
Mondo Visione  Aug 26  Comment 
Confidence among Chinese consumers rose for the third consecutive month in August as household finances continued to improve with both current and expected measures increasing solidly after July’s gains. Note that the yuan devaluation and...
newratings.com  Aug 21  Comment 
BERLIN (dpa-AFX) - Germany's consumer sentiment is set to drop in September, survey data from market research group GfK showed Friday. The consumer sentiment index fell to 9.9 in September from 10.1 points in August. Economists had forecast...
Yahoo  Aug 14  Comment 
The University of Michigan's preliminary August reading on the overall consumer sentiment index came in at 92.9, down from the final reading of 93.1 in July. The survey's gauge of consumer expectations slipped to 83.8 from 84.1 in July and was...
MarketWatch  Aug 14  Comment 
newratings.com  Aug 14  Comment 
BRUSSELS (dpa-AFX) - The U.S. dollar came off from its early lows against most major rivals in New York morning deals on Friday, after data showed that industrial production increased more-than-expected in July. The Federal Reserve report showed...
Yahoo  Aug 14  Comment 
U.S. industrial output advanced at its strongest pace in eight months in July as auto production surged, another bullish sign for third-quarter economic growth that boosts the prospects of a Federal Reserve interest rate hike next month. While...
newratings.com  Aug 14  Comment 
WASHINGTON (dpa-AFX) - Wall Street is set to tow in line with the lackluster trend in the previous session, as the major U.S. index futures point to a negative open on Friday. The guarded mood reflects nervousness concerning the course of monetary...




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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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