Global| Dec 11 2009Michigan Consumer Sentiment Recoups Earlier Declines
by:Tom Moeller
|in:Economy in Brief
Summary
Consumer sentiment began this month by retracing the declines of October and November. The 8.9% m/m rise in sentiment to a reading of 73.4, as measured by the Reuters/University of Michigan Index of Consumer Sentiment, also was near [...]
Consumer sentiment began this month by retracing the declines
of October and November. The 8.9% m/m rise in sentiment to a reading of
73.4, as measured by the Reuters/University of Michigan Index of
Consumer Sentiment, also was near the highest since January of last
year. The latest figure surpassed Consensus expectations for a level of
69.0. Sentiment was up by one-third from the low of last fall. During
the last ten years there has been a two-thirds correlation between the
level of sentiment and the three-month change real consumer spending.
Sentiment about current economic conditions jumped 15.0% from
November to the highest level since March of last year. Assessments of
current financial conditions were quite strong and rose to the highest
since last September. Buying conditions for large household goods,
including furniture, refrigerators, stoves & televisions, also
moved up by 15.8% to the highest level since January 2008.
The mid-December reading on expected economic conditions also
jumped, but by a lesser 4.8% m/m to the highest level since September.
The outlook for business conditions during the next twelve months
improved sharply and recovered November's decline but the expected
change in personal finances and expected business conditions during the
next five years advanced just modestly. All three of these readings
recently have been flat after sharp improvement early this year.
Expected price inflation during the next year held steady m/m at 3.1% but it was up from last December's reading of 1.7%.Respondents' view of government policy, which may eventually influence economic expectations, fell sharply m/m to the lowest level since March. Seventeen percent of respondent thought that a good job was being done by government versus 36% who thought a poor job was being done.
The Reuters/University of Michigan survey data are not
seasonally adjusted. The reading is based on telephone interviews with
about 500 households at month-end. These mid-month results are based on
about 320 interviews. The summary indexes are in Haver's USECON
database with details in the proprietary UMSCA database.
| University of Michigan | Mid-December | November | October | Dec y/y | 2009 | 2008 | 2007 |
|---|---|---|---|---|---|---|---|
| Consumer Sentiment | 73.4 | 67.4 | 70.6 | 22.1% | 66.3 | 63.8 | 85.6 |
| Current Conditions | 79.1 | 68.8 | 73.7 | 13.8 | 79.1 | 73.7 | 101.2 |
| Expectations | 69.7 | 66.5 | 68.6 | 29.1 | 64.2 | 57.3 | 75.6 |
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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