Expectations for a repeat of 79.6 turned into an actual 76.9 which is an unusually steep downward revision to a preliminary report. Nevertheless February's final result, though much lower than expected and down more than 2 points from January, is still the second best score since all the way back to July 2021.

And importantly February's final isn't tied to any changes in inflation expectations, which hold steady and tame at 3.0 percent for the year-ahead outlook and 2.9 percent five years out.

The report itself is stressing the favorable long-term comparisons of February's final, not the comparison with the preliminary report:"Consumers perceived few changes in the state of the economy since the start of the new year, and they appear to be assured that inflation will continue on a favorable trajectory."

Consumer sentiment for final February is expected to hold at the preliminary reading of 79.6 which was up slightly from January's 79.0. Year-ahead inflation expectations for final February are seen unchanged at 3.0 percent.

The University of Michigan's Consumer Survey Center questions households each month on their assessment of current conditions and expectations of future conditions. Preliminary estimates for a month are released at mid-month and are based on about 420 respondents. Final estimates are released near the end of the month and are based on about 600 respondents.

The pattern in consumer attitudes and spending is often the foremost influence on stock and bond markets. For stocks, strong economic growth translates to healthy corporate profits and higher stock prices. For bonds, the focus is whether economic growth goes overboard and leads to inflation. Ideally, the economy walks that fine line between strong growth and excessive (inflationary) growth.

This balance was achieved through much of the nineties and, in large part because of this, investors in the stock and bond markets enjoyed huge gains. It was during the late nineties that the consumer sentiment index hit its historic peak, reaching levels that were never matched during the subsequent 2001 to 2007 expansion nor during the long expansion following the Great Recession.

Consumer spending accounts for more than two-thirds of the economy, so the markets are always dying to know what consumers are up to and how they might behave in the near future. The more confident consumers are about the economy and their own personal finances, the more likely they are to spend. With this in mind, it's easy to see how this index of consumer attitudes gives insight to the direction of the economy. Just note that changes in consumer confidence and retail sales don't move in tandem month by month.