Economic Definition of confidence index. Defined.
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Term confidence index Definition: A measure of consumers' confidence in the economy. The two most noted measures of consumer confidence are put out by the University of Michigan and the Conference Board. Each is based on a survey that asks consumers an assortment of questions about their confidence in the economy. The questions are something like -- Are you better of now than a year ago? Do you plan to buy a new car? Do you think the economy is in good shape? The respondents can answer these questions in one of five ways -- strongly disagreeing, disagreeing, neutral, agreeing, strongly agreeing. The fraction of total respondents who agree or strongly agree on selected questions are then compiled into the confidence index.