The Consumer Confidence Index (CCI) is an indicator that measures consumers’ sentiments concerning general economic conditions within the country, their household’s economic situation, and making major household purchases. It provides an early indication of future household spending, investing, and saving. With household spending being a major contributor to the overall economy, this in turn is an early indicator of future economic growth.
The CCI is an index number, ranging from 0 (completely pessimistic) to 100 (completely optimistic). Generally, a value greater than 50 indicates that consumers are more optimistic overall about the economy and their economic prospects. The CCI is comprised of three components: (1) perceptions about how present macroeconomic conditions and the household’s financial situation compare to twelve months prior; (2) expectations about economic conditions and the household’s financial situation over the coming twelve months; and (3) perceptions about whether the present is a good time for making major purchases of durable goods such as homes, cars, furniture, and appliances. An index is also produced for each of these three components, to provide more detailed information on what is driving consumer sentiment. The CCI is intended to provide information on how consumer sentiment moves in the short term; therefore, it is usually analyzed on a month-over-month basis.
Consumer Confidence Index (CCI)