Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Consumer confidence jumps in January

By Annalyn Censky, staff reporter


NEW YORK (CNNMoney) -- Americans were more optimistic about jobs and the overall economy in January, pushing the latest reading on consumer confidence to its highest level since May 2010.

The Consumer Confidence Index shot up to 60.6 in January, from 53.3 in December, the Conference Board, a New York-based research group that compiles the index, said Tuesday.

The jump far exceeded forecasts. Economists surveyed by Briefing.com were expecting the index to increase to 53.5.

"Consumers have begun the year in better spirits," said Lynn Franco, director of The Conference Board Consumer Research Center. "Consumers rated business and labor market conditions more favorably and expressed greater confidence that the economy will continue to expand and generate more jobs in the months ahead."

The figure, which is based on a survey of 5,000 U.S. households, is closely watched because consumer spending makes up two-thirds of the nation's economic activity.

Still a long way to go

The index is still well below a healthy reading. An overall reading above 90 indicates the economy is solid, and 100 or above indicates strong growth.

And while a higher number is a positive sign, the index has been volatile and economists are still waiting for a clear trend to emerge.

"The bottom line is, it's pretty good news," said Mike Schenk, senior economist with the Credit Union National Association. "On the other hand, we're a long way from feeling like happy days are here again."

Consumer confidence wavered throughout last year, plunging to a 17-month low of 48.6 in September.

Since then, end of the year stock market gains have helped fuel optimism, as have slight improvements in the job market, Schenk said. Workers were also happy to receive a 2% raise after President Obama signed a payroll tax holiday into effect at the end of the year, he said. To top of page

Index Last Change % Change
Dow 24,606.69 21.26 0.09%
Nasdaq 6,887.02 11.22 0.16%
S&P 500 2,662.97 0.12 0.00%
Treasuries 2.37 0.02 0.77%
Data as of 12:29pm ET
Company Price Change % Change
Twenty-First Century... 34.20 1.45 4.43%
Bank of America Corp... 28.98 0.14 0.48%
General Electric Co 17.69 -0.07 -0.37%
Walt Disney Co 110.06 2.45 2.28%
Advanced Micro Devic... 10.14 0.03 0.26%
Data as of 12:14pm ET
Sponsors

Sections

More than 5% of DACA recipients have started their own businesses since enrolling the program, according to a recent survey. More

Residents of Beattyville, Kentucky, voted overwhelmingly for Donald Trump a year ago because he promised them jobs and renewed prosperity. One year later, not much has changed. But few people here are blaming him for that. More

The FCC will vote on whether to repeal net neutrality comes amid mounting protests from tech companies, consumer advocacy groups and even some Republicans in Congress. More