econintersect.com
       
  

FREE NEWSLETTER: Econintersect sends a nightly newsletter highlighting news events of the day, and providing a summary of new articles posted on the website. Econintersect will not sell or pass your email address to others per our privacy policy. You can cancel this subscription at any time by selecting the unsubscribing link in the footer of each email.



posted on 12 June 2015

Preliminary June 2015 Michigan Consumer Sentiment Rises 3.9 Points

by Doug Short, Advisor Perspectives/dshort.com

The University of Michigan preliminary Consumer Sentiment for June came in at 94.6, a bounce from the 90.7 May final reading but still below the interim high of 98.1 in January. Investing.com had forecast 91.5 for the June preliminary. The latest survey findings were a welcome improvement following last month's interim low.

Surveys of Consumers chief economist, Richard Curtin makes the following comments:

Consumer confidence rebounded in early June, regaining its average level recorded since the start of the year. The June gain was due to the most favorable personal financial prospects since 2007, with households expecting the largest wage gains since 2008. Just as importantly, consumers expected the inflation rate to remain low over the foreseeable future. The expectation of rising interest rates has caused consumers to view current rates as attractively low, but it has not yet prompted the belief that it would be better to borrow-in-advance of future increases. [More...]

See the chart below for a long-term perspective on this widely watched indicator. Recessions and real GDP are included to help us evaluate the correlation between the Michigan Consumer Sentiment Index and the broader economy.

Click to View

To put today's report into the larger historical context since its beginning in 1978, consumer sentiment is now 11 percent above the average reading (arithmetic mean) and 12 percent above the geometric mean. The current index level is at the 77th percentile of the 450 monthly data points in this series.

The Michigan average since its inception is 85.2. During non-recessionary years the average is 87.5. The average during the five recessions is 69.3. So the latest sentiment number puts us 25.3 points above the average recession mindset and 7.1 points above the non-recession average.

Note that this indicator is somewhat volatile, with a 3.1 point absolute average monthly change. The latest data point was a 3.9 point change. For a visual sense of the volatility, here is a chart with the monthly data and a three-month moving average.

For the sake of comparison here is a chart of the Conference Board's Consumer Confidence Index (monthly update here). The Conference Board Index is the more volatile of the two, but the broad pattern and general trends have been remarkably similar to the Michigan Index.

Click to View

And finally, the prevailing mood of the Michigan survey is also similar to the mood of small business owners, as captured by the NFIB Business Optimism Index (monthly update here).

Click to View

The general trend in the Michigan Sentiment Index since the Financial Crisis lows had been one of slow improvement. But the latest survey findings were a welcome bounce after last month's interim low.

Caveats on the Use of University of Michigan Consumer Sentiment

This survey is quantitatively derived from a fairly complex questionnaire (sample here) via a monthly telephone survey. According to Bloomberg:

This release is frequently released early. It can come out as early as 9:55am EST. The official release time is 10:00. Base year 1966=100. A survey of consumer attitudes concerning both the present situation as well as expectations regarding economic conditions conducted by the University of Michigan. For the preliminary release approximately three hundred consumers are surveyed while five hundred are interviewed for the final figure. The level of consumer sentiment is related to the strength of consumer spending. Please note that this report is released twice per month. The first is a preliminary figure while the second is the final (revised) figure.

This is a survey, a quantification of opinion rather than facts and data. The question - does sentiment lead or truly correlate to any economic activity? Since 1990, there seems to be a loose general correlation to real household income growth.

Related Posts:

Old Analysis Blog

New Analysis Blog

Consumer Confidence Consumer Confidence


>>>>> Scroll down to view and make comments <<<<<<




Permanent link to most recent post on this topic

Click here for Historical Releases Listing










Make a Comment

Econintersect wants your comments, data and opinion on the articles posted. You can also comment using Facebook directly using he comment block below.






Econintersect Economic Releases


search_box

Print this page or create a PDF file of this page
Print Friendly and PDF


The growing use of ad blocking software is creating a shortfall in covering our fixed expenses. Please consider a donation to Econintersect to allow continuing output of quality and balanced financial and economic news and analysis.


Take a look at what is going on inside of Econintersect.com
Main Home
Analysis Blog
The Job Guarantee, Wage-Price Inflation And Alternative Solutions: Part 1
The Job Guarantee, Wage-Price Inflation And Alternative Solutions: Part 2
News Blog
To Where The Maple Syrup Flows
The U.S. Has The Most Expensive Healthcare System In The World
Five Maps That Will Change How You See The World
What We Read Today 16 March 2017 - Special Public Edition
Hate Groups In The U.S. Are Flourishing
What We Read Today 23 March 2017
March 2017 Kansas City Fed Manufacturing At Highest Level Since March 2011
February 2017 Headline New Home Sales Improve and Above Expectations
18 March 2017 Initial Unemployment Claims Rolling Average Again Worsens
Get Around Baggage Check Fees With This Luggage Jacket
What Prompted The Electronic Devices Ban
Infographic Of The Day: The History Of Money Explained In One Infographic
Early Headlines: Asia Stocks Mixed, Oil, Dollar Up, Gold Down, Health Care Bill Fighting For Life, UK Car Mfg Hits 17-Yr High, UBS Charges 0.6% Int. On Deposits, China Debt Risks And More
Investing Blog
Early Headlines: Asia Stocks Mixed, Dollar, Oil Up, Gold Down, Health Care Vote Today, Calif. Solar, Russia And Poison, Mumbai Bridge, Sanctions Cause Suffering In N. Korea, And More
Tesla Is Playing The Long Game
Opinion Blog
Time To Stop Rewarding Economists For Bad Behaviour
The American Dream: An Endangered Ethos
Precious Metals Blog
These Gold Stocks Will Produce Much Bigger Gains Than Gold Itself
Live Markets
23Mar2017 Market Close: Stocks Reversed Lower After GOP Health Worsened, Gold And Oil Followed Stocks But Dollar Rallied
Amazon Books & More






.... and keep up with economic news using our dynamic economic newspapers with the largest international coverage on the internet
Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government































 navigate econintersect.com

Blogs

Analysis Blog
News Blog
Investing Blog
Opinion Blog
Precious Metals Blog
Markets Blog
Video of the Day
Weather

Newspapers

Asia / Pacific
Europe
Middle East / Africa
Americas
USA Government
     

RSS Feeds / Social Media

Combined Econintersect Feed
Google+
Facebook
Twitter
Digg

Free Newsletter

Marketplace - Books & More

Economic Forecast

Content Contribution

Contact

About

  Top Economics Site

Investing.com Contributor TalkMarkets Contributor Finance Blogs Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2017 Econintersect LLC - all rights reserved