A measure of U.S. consumer confidence rose in August to the second highest reading since late 2000, a positive sign for growth in consumption in the coming months.
The Conference Board on Tuesday said its index of U.S. consumer confidence rose to 122.9 in August from a revised July figure of 120.
The index in March hit 124.9, its highest level since December 2000. It has remained at high levels despite sliding downward in recent months.
"With households unusually upbeat about their current and future prospects there is every reason to expect consumption growth to remain relatively rapid in the coming quarters," said Michael Pearce of Capital Economics in a note to clients.
The rise in confidence was primarily driven by an increase in the present-situation index, which rose to 151.2 in August from a month earlier. The expectations index increased slightly to 104 from 103.
"Consumers' short-term expectations were relatively flat, though still optimistic, suggesting that they do not anticipate an acceleration in the pace of economic activity in the months ahead," said Lynn Franco, the Conference Board's director of economic indicators.
Consumers' assessment of the labor market was also more upbeat. Those stating jobs are "plentiful" rose to 35.4% in August from 33.2% in July, while those claiming jobs are "hard to get" decreased to 17.3% from 18.7%.
Measures of sentiment across the board have illustrated strength in recent months. The University of Michigan said the preliminary reading of its consumer-sentiment index was 97.6 in August, up from 93.4 in July.
Economists follow these surveys on the basis that an increase in optimism should translate into increased consumer spending. Personal-consumption expenditures advanced at a 2.8% pace in the second quarter, up from a 1.9% gain in the first quarter.
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(END) Dow Jones Newswires
August 29, 2017 11:38 ET (15:38 GMT)