U.S. consumers' opinion of the U.S. economy improved to the highest reading since July, reinforcing signals that spending is strengthening during holiday season.
The University of Michigan final December sentiment index rose to 92.6 from a preliminary reading of 91.8. Economists surveyed by The Wall Street Journal had predicted the final December index would rise to 92.0. The final November reading was 91.3.
"The December gain was largely due to lower inflation, which bolstered real incomes and brightened buying plans for household durables," said Richard Curtin, the survey's chief economist.
Consumer spending accounts for roughly two-thirds of overall economic output. Commerce Department data released earlier Wednesday showed consumer spending advanced a solid 0.3% in November from October, aided by increasing incomes and steady hiring.
Increased spending on goods outpaced the service outlays in November. That could suggest Americans are using their savings at the fuel pump--gasoline prices fell to near $2 a gallon in much of the country last month--to spend on holiday gifts and household goods.
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