Econoday Report: Consumer Sentiment 2, 2007

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Consumer Sentiment

Definition
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 2/2/07 For Jan 2007

Sentiment Index - Level
Actual	96.9
Consensus	98.0
Consensus Range	94.0 to 98.0
Previous	91.7

Highlights
Consumer confidence, long solid, is showing signs of new improvement, first signaled at mid-month by a sharp rise in the University of Michigan's consumer sentiment index followed by Tuesday's solid report from the Conference Board. Today's full month reading from the University of Michigan shows a slight downtick, to 96.9 vs. 98.0 at mid-month but with both sharply higher than December's 91.7.

Among sub-readings, expectations showed more improvement than current conditions, a sign pointing to rising confidence ahead. One-year inflation expectations edged higher but remain tame at 3.0 percent. Financial markets showed no initial reaction to the report.

Market Consensus Before Announcement
The University of Michigan's consumer sentiment index jumped sharply to 98.0 at mid-month from 91.7 in December. Gains were centered in the expectations component. Friday's report will provide an update on December with more complete numbers for the month.

Consumer sentiment index Consensus Forecast for final December 06: 98.0
Range: 94.0 to 98.0

Trends

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.)

Data Source: Haver Analytics

2007 Release Schedule

Released On: 2/2 3/2 3/30 4/27 6/1 6/29 7/27 8/31 9/28 10/26 11/21 12/21

Released For: Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec