Econoday Economic Report: Consumer Sentiment May 13, 2011

2011 Economic Calendar

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Consumer Sentiment

Released On 5/13/2011 9:55:00 AM For May(p), 2011

	Prior	Consensus	Consensus Range	Actual
Sentiment Index - Level	69.8	70.0	69.5 to 73.0	72.4

Highlights
Pessimism is easing as the consumer sentiment index rises more than 2-1/2 points to 72.4 for its best reading in two months. Details show separation between a jump in expectations, the report's leading and most important component, and a small decline in current conditions. Inflation expectations are also slightly mixed showing a moderate downtick in the one-year outlook against a small uptick in the five-year outlook.

Gas prices are a major factor in the consumer's assessment of conditions and the decline underway in oil is a plus for both inflation expectations and general sentiment. This report is good news though signals are slightly mixed and the level of the index is still well under the 75-plus average of February to December.

Market Consensus before announcement
The Reuter's/University of Michigan's Consumer sentiment index for April rose to 69.8 versus 69.6 at mid-month and 67.5 in March. Back in February, before the Libyan civil war and the Japanese earthquake, consumer sentiment was at a recovery high of 77.5. Components of the composite index were mixed as expectations gained 0.4 point from mid-month to 61.6 and current conditions dipped 0.2 point to 82.5.

Definition
The University of Michigan's Consumer Survey Center questions 500 households each month on their financial conditions and attitudes about the economy. Consumer sentiment is directly related to the strength of consumer spending. Consumer confidence and consumer sentiment are two ways of talking about consumer attitudes. Among economic reports, consumer sentiment refers to the Michigan survey while consumer confidence refers to The Conference Board's survey. Preliminary estimates for a month are released at mid-month. Final estimates for a month are released near the end of the month. Why Investors Care

Consumer sentiment is mainly affected by inflation and employment conditions. However, consumers are also impacted by current events such as bear & bull markets, geopolitical events such as war and terrorist attacks. Investors monitor consumer sentiment because it tends to have an impact on consumer spending over the long run (although not necessarily on a monthly basis.)

2011 Release Schedule

Released On: 1/14 1/28 2/11 2/25 3/11 3/25 4/15 4/29 5/13 5/27 6/17 7/1 7/15 7/29 8/12

Release For: Jan Jan Feb Feb Mar Mar Apr Apr May May Jun Jun Jul Jul Aug

Released On: 8/26 9/16 9/30 10/14 10/28 11/11 11/23 12/9 12/22

Release For: Aug Sep Sep Oct Oct Nov Nov Dec Dec