IBD TIPP Economic Optimism

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IBD/TIPP name comes from Investor’s Business Daily (IBD), Technometrica Institute of Policy and Politics (TIPP) and it is an index based on surveyed consumers. It represents a second tier data, in the sense that markets do not really move when it is released, regardless if it comes better/lower than expectations, but it is important in the sense that this survey takes into consideration approximately 900 consumers and the consumer pool is relevant for interpreting the data.

Like the majority of the surveys, values higher than 50 indicate optimism, while values below 50 represent pessimism, and better than expected values should be interpreted as being positive for the currency, while lower than expected values should be interpreted as being negative for the currency.

Consumers are being asked questions regarding the relative level of economic conditions, some of them dealing with the six months economic outlook, with the personal financial outlook, or with the confidence in the federal economic policies.

Looking at the past six months worth of data and you can see that from February 2013 until July 2013 all six months had values below the 50 level, and this means a prolonged level of pessimism surrounding consumers and should worry economic policy makers.

The most important things to keep in mind regarding construction spending indicator:

  • release date: monthly, around the middle of the current month;
  • release time: 14:00 GMT during North American session;
  • second tier data;
  • it is an index based on surveyed customers;
  • higher than 50 suggests optimism;
  • lower than 50 suggests pessimism.

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