U. Michigan: Consumer Sentiment Falls in September

ANN ARBOR, September 30 — The University of Michigan Survey of Consumers reported a decline in its sentiment index for September, marking a drop in consumer confidence as measured by the monthly gauge of economic attitudes. The survey, conducted by the university’s Institute for Social Research, tracks household views on personal finances, business conditions, and buying intentions, with the September reading reflecting worsening sentiment compared to prior months. While the source material provides no specific index value, percentage change, or prior-level comparison, it confirms the direction of movement: sentiment fell. The decline is presented as a factual outcome of the survey’s release, without attribution to specific drivers such as inflation, interest rates, or labor market concerns, though such factors are noted as potential influences in the broader context. The survey has been administered monthly since the 1940s and remains a closely watched indicator for policymakers, economists, and market analysts assessing near-term economic momentum. The Index of Consumer Sentiment, first developed in the late 1940s by Professor George Katona, is normalized to a value of 100 in the first quarter of 1966, providing a historical benchmark for interpreting changes over time. Each monthly survey draws from a statistically representative sample of American households, excluding Alaska and Hawaii, and currently consists of about 50 core questions covering personal financial outlook, short- and long-term economic expectations, and attitudes toward major purchases. Approximately 1,000 interviews are conducted each month via web-based recruitment using postal address sampling, ensuring broad demographic coverage. The Index of Consumer Expectations, a sub-index derived from the survey, is formally included in the U.S. Department of Commerce’s Leading Indicator Composite Index, underscoring its role in forecasting economic turns. These structural features allow the index to serve as a tool for modeling consumer spending and saving behavior based on empirical expectations data. Joanne Hsu has served as director and chief economist of the Consumer Sentiment Index since her appointment in 2022, overseeing the survey’s methodology, analysis, and public release. Under her leadership, the survey has maintained its monthly cadence and continued to be distributed through multiple channels, including the university’s website, Bloomberg, and Macrobond, a shift that followed the discontinuation of Thomson Reuters’ early-release practice in 2013. That earlier arrangement, which granted select clients access to the data minutes before public release, had drawn scrutiny over fairness in financial markets, with former SEC Chairman Harvey Pitt warning it could erode public confidence. The university acknowledged receiving approximately $1 million annually from Reuters for the advance data but stated the funding was essential to sustaining the survey’s operations. Since 2015, the index has been available simultaneously to all users, eliminating the earlier information asymmetry. The September reading adds to this long-running data series, contributing to the ongoing assessment of consumer sentiment amid evolving economic conditions. Watch for the October release to determine whether the September decline represents a temporary fluctuation or the start of a more sustained shift in confidence.

Sources

• University of Michigan Survey of Consumers — Wikipedia