Global| Feb 15 2008Michigan Consumer Sentiment Dropped Hard
by:Tom Moeller
|in:Economy in Brief
Summary
During early February, the University of Michigan's consumer sentiment index fell a hard 11.2% from the January average to a level of 69.6. A reading of 76 had been expected. It was the largest m/m decline since 2005 and it was to the [...]
During early February, the University of Michigan's consumer sentiment index fell a hard 11.2% from the January average to a level of 69.6. A reading of 76 had been expected. It was the largest m/m decline since 2005 and it was to the lowest level since early 1992.
The index of expected business conditions during the next year fell the hardest with a 12.8% m/m decline to its lowest level since the recession of 1990. Expectations for business conditions during the next five years fell 10.2% while expectations for personal finances fell 6.9%.
The current conditions index more than reversed the January rise with a 9.5% drop. Current conditions for buying large household goods fell out of bed with a 15.1% plunge to the lowest level since 1992. The view of current personal finances fell slightly.
Expectations for inflation during the next twelve months were unchanged at 4.0% and for the next five to ten years expectations ticked up to 3.5%.
Opinions about government policy fell sharply. The 9.0% m/m decline was one of the largest and dropped this measure of opinions to the lowest level since 1993.
The University of Michigan survey is not seasonally adjusted.The reading is based on telephone interviews with about 500 households at month-end; the mid-month results are based on about 300 interviews. The summary indexes are in Haver's USECON database, with details in the proprietary UMSCA database.
| University of Michigan | Feb (Prelim. | Jan | Dec | Feb y/y | 2007 | 2006 | 2005 |
|---|---|---|---|---|---|---|---|
| Consumer Sentiment | 69.6 | 78.4 | 75.5 | -23.8% | 85.6 | 87.3 | 88.5 |
| Current Conditions | 85.4 | 94.4 | 91.0 | -20.0% | 101.2 | 105.1 | 105.9 |
| Expectations | 59.4 | 68.1 | 65.6 | -27.1% | 75.6 | 75.9 | 77.4 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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