A snapshot as of July:
Figure 1: U. Michigan Consumer Sentiment (FRED series UMCSENT) (blue), Conference Board Confidence (tan), SF Fed News Sentiment index (green), all standardized. July sentiment is preliminary; July news sentiment through July 21. NBER defined peak-to-trough recession dates shaded gray. U.Michigan via FRED, Conference Board, SF Fed, NBER and author’s calculations.
Using a regression of UMCSENT on news sentiment over the above sample period (Adj. R2 = 0.41), the (preliminary) July observation on the is 7 points below actual, just about 2 standard errors away from predicted.
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