NEW YORK – Consumer sentiment rose in March from February, as Americans discounted the effects of government budget cuts and instead saw continued healing in the labor market, a survey released on Friday showed.
The Thomson Reuters/University of Michigan's final reading on the overall index of consumer sentiment came in at 78.6, up from 77.6 the month before.
The final March figure was up sharply from the preliminary reading of 71.8, and above the median forecast of 72.5 among economists polled by Reuters. It was also the highest reading since November.
Consumer confidence jumped sharply in the second half of the month, erasing the decline of the first half of March, survey director Richard Curtin said in a statement.
That surge came from two factors, he said.
"Consumers have discounted the administration's warning that economic catastrophe would follow the reductions in federal spending, and consumers have renewed their expectation that gains in employment will accelerate through the rest of 2013."
The survey's barometer of current economic conditions rose to 90.7 from 89.0 the previous month and above a forecast of 87.8.
The survey's gauge of consumer expectations rose to 70.8 from February's 70.2 and an expected 62.0.
The survey's one-year inflation expectation fell to 3.2 percent from 3.3 percent, while the survey's five-to-10-year inflation outlook was at 2.8 percent from 3.0 percent.
(Reporting By Luciana Lopez; Editing by Chizu Nomiyama)