The Economic Sentiment Indicator (ESI) is a measure that reflects the overall mood of consumers and businesses regarding the economy. It is derived from surveys that ask participants about their expectations for economic growth, employment, and inflation. A higher ESI indicates optimism, while a lower ESI suggests pessimism. Governments and analysts use the ESI to gauge economic health and make informed decisions. It can influence policies and investment strategies, as changes in sentiment often precede shifts in economic activity. The ESI is closely monitored by organizations like the European Commission and various financial institutions.