Economic Event · twice monthly

University of Michigan Consumer Sentiment

Source: University of MichiganRelease: ~15th (prelim), ~last Friday (final)Time: 10:00 AM ET

The University of Michigan releases the Consumer Sentiment Index twice a month: a preliminary reading around the 15th and a final revision around the last Friday, both at 10:00 AM ET. The survey covers ~500 households and measures consumer attitudes about personal finances and the broader economy. Consumer sentiment is a leading indicator of discretionary spending. When sentiment collapses, consumers pull back on big-ticket purchases, restaurants, and travel before it shows up in hard data like retail sales. The survey also includes 1-year and 5-year inflation expectations, which the Fed watches closely as a gauge of whether inflation expectations remain anchored.

Why It Matters

Michigan sentiment hit 50.0 in June 2022, the lowest reading since the 2008 financial crisis, reflecting consumer anxiety over inflation and rate hikes. The decline correctly foreshadowed the slowdown in consumer spending that followed. The 5-year inflation expectations component briefly spiked to 3.3% in April 2022, prompting emergency Fed communication to reinforce its inflation-fighting credibility.

What to Watch For

•Headline sentiment index level
•1-year inflation expectations (Fed watches closely)
•5-year inflation expectations (anchoring signal)
•Current conditions vs. expectations split
•Preliminary vs. final revision direction

Market Reaction Pattern

Sentiment collapse: consumer discretionary sells off, defensive sectors outperform. Inflation expectations spike: rates up, gold up, dollar volatile. Preliminary readings move markets more than final revisions.