Does Consumer Confidence Forecast Household Expenditure? A Sentiment Index Horse Race

[...]This study is the first formal investigation ofconsumer attitudes that compares the forecasting power ofthe University of Michigan’s Index of Consumer Sentimentand the Conference Board’s Consumer Confidence Index.We begin with a background analysis of structural differencesbetween the Michigan and Conference Board indexes.We then undertake a formal statistical comparison of thepredictive power exhibited by each overall survey and itscomponent questions for several categories of consumerspending growth.[...]