University of Michigan United States Consumer Sentiment

University of Michigan Consumer Sentiment demonstrates how US consumers estimate the relative level of current and future economic conditions. It is calculated monthly based on a telephone survey of at least 500 US households, which the University of Michigan conducts to calculate five different indices, including this one.

Respondents are polled to express their opinion on the following questions:

• Whether their families' financial conditions have become better or worse than a year ago
• Whether respondents expect their families' financial conditions to become better or worse a year from now
• Whether business conditions in the next 12 months will become better or worse
• How conditions in the country may change in the next five years - whether respondents expect stability or growth of unemployment or depression.
• Whether it is a good time to purchase large household items and make other large purchases (such as to by a house, a car, etc.)

Answers to these questions are calculated as follows: the percentage of negative values is subtracted from positive ones, and 100 is added to the resulting value. The resulting values ​​are added up and divided by 6.7558 (the benchmark value), after which 2 (the correction constant for the sample composition) is added to the resulting figure.

University of Michigan Consumer Sentiment allows measuring how US households evaluate the economy strength, financial changes and how they estimate their current and future financial situation, in particular, whether they are willing to spend money. The index growth allows making a favorable forecast of the US economy health. Optimistic sentiment about large purchases can be a leading indicator of consumer activity growth, and hence, of the growth of inflation. University of Michigan Consumer Sentiment growth is usually seen as positive for the US dollar.