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US Consumer Confidence Jumps to 7-Month High

U.S. consumer confidence jumped this month to the highest level since February, bolstered by a brighter hiring outlook.

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The Conference Board said Tuesday that its Consumer Confidence Index rose to 70.3. That’s up from 61.3 in August, which was revised higher. And it’s the highest reading since February, when the economy added 259,000 jobs.

The indicator is watched closely because consumer spending drives nearly 70 percent of economic activity. The reading is still below 90, a level that indicates a healthy economy. Since the beginning of the year, the index has fluctuated sharply.

The survey was conducted from Sept. 1 through Sept. 13. It showed consumers were more optimistic about the current availability of jobs and their outlook over the next six months.

Their confidence in the job market is higher, even though employers added just 96,000 jobs in August. That’s down from 141,000 in July and too few to keep up with population growth.

The unemployment rate fell to 8.1 percent from 8.3 percent, but only because many people gave up their job search, so they were no longer counted as unemployed.

A measure of how consumers feel now about the economy rose to 50.2, up from 46.5 last month. And they are even more optimistic about the next six months.  The upbeat report on confidence comes as a widely watched index on home prices offered more evidence of a housing recovery.

According to the Standard & Poor’s/Case Shiller index, home prices kept rising in July across the United States, buoyed by greater sales and fewer foreclosures.

National home prices increased 1.2 percent in July, compared to the same month last year, according to the index. That’s the second straight year-over-year gain after two years without one. Steady price increases and record-low mortgage rates are helping drive a housing recovery.

Those stating jobs are “plentiful” rose to 8.3 percent from 7.2 percent, while those claiming jobs are “hard to get” edged down to 39.9 percent from 40.6 percent.

Those expecting more jobs in the months ahead increased to 18.5 percent from 15.8 percent, while those anticipating fewer jobs declined to 18.5 percent from 23.7 percent.

The proportion of consumers expecting an increase in their incomes edged up to 16.3 percent from 16.0 percent.

 

(Copyright 2012 by The Associated Press. All Rights Reserved.)

 

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