U.S. consumer confidence increased by more than expected to a five-month high in January on brighter views of labor-market conditions, adding to signs that Americans are poised to keep supporting a record-long expansion.
The Conference Board’s index climbed to 131.6 from a upwardly revised December reading of 128.2, according to data released Tuesday that topped all estimates of economists in a Bloomberg survey calling for a rise to 128. Present conditions and economic expectations both reached the highest levels since August.
- The advance was primarily driven by more positive assessments of the current job market as well as greater optimism about future employment prospects, underscoring how the lowest unemployment in a half century is keeping Americans upbeat and likely more inclined to keep their wallets open.
- Other measures of consumer confidence have remained elevated. The University of Michigan’s index of sentiment remains near one of the best levels in almost two decades and Bloomberg’s consumer comfort gauge stands at a 19-year high.
- Buying plans were mixed, with the number of people planning to purchase a vehicle in the next six months easing slightly from last month while more respondents said that they had plans to buy a home.
- The share of respondents expecting stocks to rise in the next year advanced to 43.1%, the highest since October 2018.
“Optimism about the labor market should continue to support confidence in the short-term and, as a result, consumers will continue driving growth and prevent the economy from slowing in early 2020,” Lynn Franco, senior director for economic indicators at the Conference Board, said in a statement.
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