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Consumer Confidence

Trading Term

The relative optimism of the consumer is captured in one of several surveys in which the public are asked to respond to a series of questions asking them to reflect upon their financial health, optimism or pessimism on the state of the economy, the level of interest rates and the future path of government or central bank policy. Several companies or agencies collect such data to understand how customers respond to changes in the macroeconomic environment and may plan output accordingly. Commonly known surveys include those conducted by the University of Michigan and the Conference Board. Policymakers are interested in consumer confidence reports over time, and especially as asset market values, the pace of inflation, labor markets as well as fiscal policy matters change.

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