The University of Michigan's Consumer Survey Center questions 500 households each month on their financial conditions and attitudes about the economy. Consumer sentiment is directly related to the strength of consumer spending. Consumer confidence and consumer sentiment are two ways of talking about consumer attitudes. Among economic reports, consumer sentiment refers to the Michigan survey while consumer confidence refers to The Conference Board's survey. Why Investors Care
| Released on 1/19/07 For Jan 2007 | ||||||||||||
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Highlights
Economic data have been firming and now so has consumer sentiment as the University of Michigan's index jumped sharply to 98.0 at mid-month from 91.7 in December. Gains were centered in the expectations component, a major plus that points to further gains in the months ahead. Inflation expectations, thanks to stable gas prices, held steady at 3.0% vs. December's 2.9%. Treasuries slipped and the dollar firmed in initial reaction to the results.
The University of Michigan's consumer sentiment index slipped back in December, to a final reading of 91.7 vs. 92.1 in November. Since the last survey, the stock market has been sluggish but oil prices have fallen. These could be offsetting factors for the preliminary January reading of the consumer sentiment index.
Consumer sentiment index Consensus Forecast for preliminary January 07: 92.5
Range: 91.0 to 94.0
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Consumer sentiment is mainly affected by inflation and employment conditions. However, consumers are also impacted by current events such as bear & bull markets, geopolitical events such as war and terrorist attacks. Investors monitor consumer sentiment because it tends to have an impact on consumer spending over the long run (although not necessarily on a monthly basis.) |
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