University of Michigan Consumer Sentiment Index
The University of Michigan Consumer Sentiment Index (MCSI) measures the consumer propensity of private households in the United States . It is published by Thomson Reuters and the University of Michigan . The index is in competition with the Consumer Confidence Index , the consumer confidence index of the Conference Board.
concept
The University of Michigan Consumer Sentiment Index (MCSI) is a leading indicator of economic development in the USA. For the calculation, 500 representatively selected consumers are questioned about their personal finances, general business climate and their consumption plans, in particular their propensity to buy durable consumer goods . The monthly report, the Surveys of Consumers, measures the confidence that households have in the performance of the American economy . Consumer confidence is a key indicator of consumer spending, which accounts for around two-thirds of US economic output.
The survey consists of five questions on the following topics:
- Judgment on the current financial situation of the household
- Judgment on the financial situation of the household in one year
- Assessment of the economic development in one year
- Expectation of the economic development in the next five years
- Purchase intentions
The participants in the survey are given the opportunity to answer questions freely, so the examiner has more clues to classify the answers. Thomson Reuters and the University of Michigan use all the data to calculate two sub-indices that together make up the overall index: the Current Conditions Index for assessing the current situation and the Index of Consumer Expectations, which includes the assessment of future expectations. Opinions on current behavior account for up to 40 percent of the overall index, expectations of future behavior make up 60 percent.
Specific examination criteria are also:
- Expected inflation in a year and five years
- Expected unemployment
- Expected Interest
- Satisfaction with state economic policy
The preliminary results from the Surveys of Consumers are published around the 15th of each month; finally on the last business day of the month at 10:00 a.m. EST (4:00 p.m. CET ).
rating
US consumer confidence is closely correlated with unemployment, inflation and real income. There is a strong connection with consumer behavior. However, the sizes do not necessarily match.
One of the strengths of the University of Michigan Consumer Sentiment Index (MCSI) is that it publishes data for the current month. Consumer confidence is a leading indicator of economic cycles. The published information provides information about the current situation and future expectations of consumers.
One of the weaknesses of the index is that consumers do not have the information necessary to make a correct estimate of income and job growth in advance. The monthly report contains information about planned expenses that are not necessarily made.
In a phase of prolonged economic growth, buying intentions may decrease despite falling unemployment , as the brisk demand has already been satisfied. On the other hand, when inflation rises, the purchase plans can increase in the short term, as consumers, in anticipation of rising prices, implement them quickly in order to avoid the price increase.
The financial markets react sensitively to unexpected changes in the index; it is perceived as a leading indicator for economic developments as well as rising inflation . MCSI and Purchasing Managers Index , like the Case Shiller Index , the FHFA House Price Index or the oil price, belong to the group of indicators , the development of which has a noticeable influence on the stock indices .
In addition to the MCSI, there are two consumer confidence indices in the USA : the Conference Board's Consumer Confidence Index and the Washington Post's ABC News Consumer Comfort Index . While the question of the Conference Board focuses on the labor market situation, the other indices focus on the financial situation of households. In contrast to the Consumer Confidence of the Conference Board, MCSI does not provide regional indices.
history
Historical overview
The University of Michigan Consumer Sentiment Index (MCSI) was developed in the 1940s by economist George Katona . From November 1952 to the end of 1977 the index was published quarterly and from January 1978 monthly. The base value is 100 points in February 1966. The University of Michigan has been calculating the index together with the Reuters news agency since January 2007. The long-term average of the MCSI time series from 1952 to 2007 is 88.5 index points. The average from 2008 to 2012 is 69.2 index points. The average of the entire time series from 1952 to 2012 is 86.8 index points.
During the oil crisis in the 1970s, the index fell below the 60 point limit for the first time. In February 1975 it reached a low of 57.6 points. The index reached its all-time low during the recession in the early 1980s. In May 1980, a record low of 51.7 points was determined.
In January 2000 the MCSI reached an all-time high of 112.0 points. In the course of the financial crisis from 2007 onwards, unemployment in the USA grew and real income fell. Accordingly, consumer confidence fell in November 2008 to a low of 55.3 points. As the US economy recovered, so did the index. In February 2011 a value of 77.5 points was determined.
In August 2011 consumer confidence fell to 55.7 points, the fourth lowest level since the start of the data series in November 1952. Only April 1980 with 52.7 points, May 1980 with 51.7 points and November 2008 with 55, 3 points were a little lower. According to the chief economist Professor Richard Curtin, head of the consumer survey, such low levels in the past signaled a recession.
In November 2012 the index rose to 82.7 points, its highest level since September 2007.
For the month of December 2012 a value of 72.9 points was determined.
Best and worst months
The table shows the months with the highest and lowest values on the University of Michigan Consumer Sentiment Index since 1952.
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Annual development
The following table shows the annual highs, lows, and closings as well as the annual average of the University of Michigan Consumer Sentiment Index since 1952.
| year | Peak | Lowest point | Final stand | Annual average |
|---|---|---|---|---|
| 1952 | 86.2 | 86.2 | 86.2 | 86.2 |
| 1953 | 90.7 | 80.7 | 80.7 | 86.2 |
| 1954 | 87.0 | 80.7 | 87.0 | 83.2 |
| 1955 | 99.7 | 87.0 | 99.7 | 97.4 |
| 1956 | 100.2 | 98.2 | 100.2 | 99.5 |
| 1957 | 100.2 | 83.7 | 83.7 | 93.8 |
| 1958 | 90.8 | 78.5 | 90.8 | 82.2 |
| 1959 | 95.3 | 90.8 | 93.8 | 93.6 |
| 1960 | 100.0 | 90.1 | 90.1 | 95.5 |
| 1961 | 99.2 | 90.1 | 93.0 | 93.8 |
| 1962 | 99.9 | 91.6 | 95.0 | 95.3 |
| 1963 | 98.4 | 91.7 | 94.4 | 95.3 |
| 1964 | 100.6 | 94.4 | 99.9 | 99.2 |
| 1965 | 105.4 | 99.9 | 102.9 | 103.2 |
| 1966 | 102.9 | 88.3 | 88.3 | 95.7 |
| 1967 | 97.0 | 88.3 | 92.9 | 94.6 |
| 1968 | 97.2 | 91.7 | 91.7 | 93.5 |
| 1969 | 98.2 | 79.7 | 79.7 | 90.0 |
| 1970 | 79.7 | 72.4 | 72.4 | 76.5 |
| 1971 | 82.1 | 72.4 | 82.0 | 79.8 |
| 1972 | 95.2 | 82.0 | 90.7 | 91.1 |
| 1973 | 90.7 | 72.0 | 76.5 | 78.0 |
| 1974 | 76.5 | 59.5 | 59.5 | 65.9 |
| 1975 | 75.7 | 57.6 | 75.6 | 69.1 |
| 1976 | 89.7 | 75.6 | 87.0 | 85.2 |
| 1977 | 90.2 | 84.4 | 84.4 | 87.9 |
| 1978 | 84.3 | 66.1 | 66.1 | 79.4 |
| 1979 | 73.9 | 60.4 | 61.0 | 66.0 |
| 1980 | 76.7 | 51.7 | 64.5 | 64.4 |
| 1981 | 77.2 | 62.5 | 64.3 | 70.7 |
| 1982 | 73.4 | 62.0 | 71.9 | 68.0 |
| 1983 | 94.2 | 70.4 | 94.2 | 87.4 |
| 1984 | 101.0 | 92.9 | 92.9 | 97.5 |
| 1985 | 96.5 | 88.4 | 93.9 | 93.2 |
| 1986 | 99.3 | 89.1 | 89.1 | 94.8 |
| 1987 | 94.4 | 83.1 | 86.8 | 90.6 |
| 1988 | 97.4 | 90.8 | 91.9 | 93.7 |
| 1989 | 97.9 | 89.6 | 90.5 | 92.8 |
| 1990 | 93.9 | 63.9 | 65.5 | 81.6 |
| 1991 | 87.7 | 66.8 | 68.2 | 77.6 |
| 1992 | 91.0 | 67.5 | 91.0 | 77.3 |
| 1993 | 89.3 | 77.0 | 88.2 | 82.8 |
| 1994 | 95.1 | 89.0 | 95.1 | 92.3 |
| 1995 | 97.6 | 88.2 | 91.0 | 92.2 |
| 1996 | 99.2 | 88.5 | 96.9 | 93.6 |
| 1997 | 107.2 | 97.4 | 102.1 | 103.2 |
| 1998 | 110.4 | 97.4 | 100.5 | 104.6 |
| 1999 | 108.1 | 103.2 | 105.4 | 105.8 |
| 2000 | 112.0 | 98.4 | 98.4 | 107.6 |
| 2001 | 94.7 | 81.8 | 88.8 | 89.2 |
| 2002 | 96.9 | 80.6 | 86.7 | 89.6 |
| 2003 | 93.7 | 77.6 | 92.6 | 87.6 |
| 2004 | 103.8 | 90.2 | 97.1 | 95.2 |
| 2005 | 96.5 | 74.2 | 91.5 | 88.6 |
| 2006 | 93.6 | 79.1 | 91.7 | 87.3 |
| 2007 | 96.9 | 75.5 | 75.5 | 85.6 |
| 2008 | 78.4 | 55.3 | 60.1 | 63.8 |
| 2009 | 73.5 | 56.3 | 72.5 | 66.3 |
| 2010 | 76.0 | 67.7 | 74.5 | 71.8 |
| 2011 | 77.5 | 55.7 | 69.9 | 67.4 |
| 2012¹ | 82.7 | 72.3 | 72.9 | 76.5 |
¹ December 31, 2012
Web links
Individual evidence
- ↑ Markt-daten.de: Wirtschaftsindikatoren ( Memento of the original from December 15, 2010 in the Internet Archive ) Info: The archive link was inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice.
- ↑ Markt-daten.de: Consumer Confidence / Sentiment of the University of Michigan ( Memento of the original from November 17, 2011 in the Internet Archive ) Info: The archive link was inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice.
- ↑ Reuters: Sentiment among US consumers is clouding over , from July 15, 2011
- ↑ Reuters: U.S. Consumers Grapple with Fear of Recession , dated Aug. 12, 2011
- ^ A b Federal Reserve Bank of St. Louis: Historical data 1952-1977
- ^ A b Federal Reserve Bank of St. Louis: Historical data from 1978
- ↑ a b AAStocks: historical data from 2001
