How are sentiment indices determined?

Rhody Trader said:

You'll find that most sentiment indices are survey driven, though that isn't always true. As for your specific example:

The Economic Sentiment Indicator (ESI) is a composite indicator made up of five sectoral confidence indicators with different weights: Industrial confidence indicator, Services confidence indicator, Consumer confidence indicator, Construction confidence indicator Retail trade confidence indicator. Confidence indicators are arithmetic means of seasonally adjusted balances of answers to a selection of questions closely related to the reference variable they are supposed to track (e.g. industrial production for the industrial confidence indicator). Surveys are defined within the Joint Harmonised EU Programme of Business and Consumer Surveys. The economic sentiment indicator (ESI) is calculated as an index with mean value of 100 and standard deviation of 10 over a fixed standardised sample period. Data are compiled according to the Statistical classification of economic activities in the European Community, (NACE Rev. 2). Source: DG ECFIN

http://ec.europa.eu/eurostat/web/products-datasets/-/teibs010

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zaysev36 said:

Thanks. So it's a survey, got it. Would you happen to know some examples of "questions closely related to the reference variable they are supposed to track"? And who exactly gets surveyed?

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Rhody Trader said:

You'd have to dig into the surveys. A lot of them are based on plans and/or expectations for the future.

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