The Effects of Oil Supply and Demand Shocks on U.S. Consumer Sentiment

Jochen Güntner and Katharina Linsbauer

Journal of Money, Credit and Banking, 2018, vol. 50, issue 7, 1617-1644

Abstract: This paper investigates how the University of Michigan's Index of Consumer Sentiment responds to oil price shocks. While oil supply shocks play only a limited role, the effect of aggregate demand shocks is positive for the first few months and negative thereafter. A typical other oil demand shock has a significant negative impact for up to 2 years. By studying the responses of individual survey questions, we find that expectations of future inflation and a change in real household income as well as perceived vehicle and house buying conditions are the main transmission channels of oil supply and demand shocks.

Date: 2018
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Citations: View citations in EconPapers (17)

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https://doi.org/10.1111/jmcb.12512

Related works:
Working Paper: The effects of oil supply and demand shocks on U.S. consumer Sentiment (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:wly:jmoncb:v:50:y:2018:i:7:p:1617-1644

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