Glossary
Consumer Confidence
Survey measures of how households feel about the economy and their finances, such as the Conference Board and Michigan indexes.
On this page
Consumer confidence is a family of survey-based indicators that measure how optimistic US households feel about business conditions, jobs and their own finances. Because consumer spending is roughly two-thirds of US GDP, economists and markets watch these readings for early hints about whether people will open or close their wallets.
The two main US gauges
- The Conference Board Consumer Confidence Index, released on the last Tuesday of each month, is indexed so that 1985 = 100. It leans on questions about business conditions and the job market, and splits into a Present Situation index and an Expectations index.
- The University of Michigan Index of Consumer Sentiment, with a preliminary reading mid-month and a final one at month-end, is indexed to the first quarter of 1966 = 100. It puts more weight on personal finances and buying conditions, and also publishes households' expected inflation one year and five to ten years ahead.
How to read it
Confidence surveys measure mood, not behavior, and the link is loose. Sentiment fell to very low levels in 2022 while spending kept growing. The readings react strongly to gas prices, stock prices and headlines, and the two surveys can disagree in the same month. Analysts therefore compare them with hard data such as retail sales, the Unemployment rate and the PCE price index rather than treating a single print as a forecast. The Michigan inflation-expectations series is closely watched by the Federal Reserve.