October Consumer Sentiment Rises Handily Above All Expectations
The Reuters/University of Michigan consumer sentiment reading is out showing the preliminary October report. It gave a sentiment reading 83.1. This was well above the Bloomberg consensus reading of 78.3 (with a range of estimates of 75 to 81), and Dow Jones was calling for a reading of 78.0 for this latest preliminary sentiment report. In short, this was higher than all expectations.
The current index was 88.6 and the expectations index was 79.5. The five-year inflation forecast was also put at a higher than comfortable 2.6%.
Today's report is a preliminary one that will be adjusted in two weeks. It is also important to realize that the University of Michigan's Consumer Survey Center questions only 500 households about their financial conditions and attitudes about the economy each month. With only 500 samples, this can have a wider degree of error than more broad-based reports. It is far smaller than the Conference Board's Consumer Confidence report each month.
Bloomberg notes, "Consumer sentiment is directly related to the strength of consumer spending. Consumer confidence and consumer sentiment are two ways of talking about consumer attitudes."
JON C. OGG