Consumer Confidence Soars to Near 7-Year High

Consumer Confidence
LM Otero/AP

WASHINGTON -- U.S. consumers are more confident about the economy than they have been in nearly seven years.

The Conference Board said Tuesday that its confidence index rose to 90.9 in July from an upwardly revised 86.4 in June. The July reading is the highest since October 2007, two months before the Great Recession officially began.

It was the third straight increase in the index. Economists said that strong job growth has helped boost consumers' assessment of current conditions and also improved their outlook on jobs and the economy.

"Americans felt a heck of a lot more confident in July," said Jennifer Lee, senior economist at BMO Capital Markets. She said that part of the confidence boost likely came from declining gas prices.

Conference Board economist Lynn Franco said that the improvements in consumers' confidence and expectations about the future indicate that the recent strengthening in overall economic growth should continue in the second half of the year.

Confidence has been rising since bottoming in February 2009 at 25.3. The index is now well above last year's average of 72.3 and with July's gain has now returned a level above 90, where it often hovered before the recession.

Consumers' attitudes are closely watched because their spending accounts for about 70 percent of U.S. economic activity.

For July, consumer assessment of the labor market improved with those saying that jobs were plentiful increasing to 15.9 percent, up from 14.6 percent.

Consumers' expectations about the future were also more optimistic with those anticipating more jobs in the months ahead increasing to 19.1 percent, up from 16.3 percent in June.

The unemployment rate fell to 6.1 percent in June, the lowest level since September 2008. Employers added 288,000 jobs in June, marking the fifth straight month of job gains above 200,000. That is the best such stretch since the late 1990s tech boom.

Economists believe the job gains will continue in coming months and that that will help propel the economy to stronger growth.

In the January-March quarter, economic output went into reverse, falling at an annual rate of 2.9 percent. That big drop was blamed in large part on severe winter weather. Those conditions dampened everything from trips to the mall by shoppers to factory production.

The government will provide its first look at economic activity in the April-June on Wednesday and economists are predicting a solid rebound to growth of around 2.9 percent. Analysts believe the economy will pick up even more momentum in the second half of the year, helped by further job gains providing people with more money to spend.

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I was appalled at the old dated in the BLS archives concerning the deepening manufacturing
as the 2000 transcended into 2001. The previous administration just sat on it's butt as the plants kept closing like he was satified with the losses that us older people couldn't make up.

July 30 2014 at 5:40 PM Report abuse rate up rate down Reply

Yellen once again refered to the underutilization of labor.

You know that participation rate is in the toilet, higher wages, fulltime, and benefits are scarce. Pumping the economy with nickel and dimed workers while pushing older workers out the door or harrasing them isn't going to rebuild America.

July 30 2014 at 5:04 PM Report abuse rate up rate down Reply

Brought to you by the Democrats for Prosperity committee.

July 30 2014 at 4:08 PM Report abuse rate up rate down Reply

Confidence has returned as the mid-terms and the promise of a GOP controlled Senate get closer! End of story!

July 30 2014 at 3:35 PM Report abuse +2 rate up rate down Reply

Don't believe this for one second. Just more peopaganda from Obsama. OMg

July 30 2014 at 9:01 AM Report abuse +3 rate up rate down Reply

The US economy will eventually correct no matter who's in the White House. That's one reason we're the envy of the world. But really, couldn't it also be a backlash against AM radio saying "Obama sucks" for the past six years?

July 30 2014 at 8:02 AM Report abuse rate up rate down Reply
2 replies to ezspin42's comment

That use to be true when we made products and created technology in the US that we sold...we no longer do that . The economy will never correct I am sorry to say. We will just run out of money.

July 30 2014 at 2:25 PM Report abuse rate up rate down Reply
1 reply to SPQR's comment

We will run out of money but those that sold out America for campaign donors will still get a pension after they leave office.

July 30 2014 at 5:46 PM Report abuse rate up rate down

You must of meant a "Correction"?

July 30 2014 at 5:13 PM Report abuse rate up rate down Reply

The economy will only climb back up when Obama is out of the WH FOREVER...

July 30 2014 at 7:46 AM Report abuse +5 rate up rate down Reply
1 reply to Michele's comment

It's just to bad Socks the cat couldn't of been around when NAFTA was signed. He could of jumped right up on that desk and shredded the document like an American!

July 30 2014 at 5:45 PM Report abuse rate up rate down Reply

I don't know anyone who is upbeat about the economy. I think what is happening is that at some point there are certain things you have to purchase and you have to take a lower paying job even though you are not making enough to pay all of your bills. This is not being upbeat.

July 30 2014 at 5:41 AM Report abuse +9 rate up rate down Reply
1 reply to cpruitt221's comment

Maybe you should move or get new friends. Most of us are doing great.

July 30 2014 at 9:51 AM Report abuse -4 rate up rate down Reply

What was the amount of debt president Obama added to Bush's fiasco, mac2jr ?

July 30 2014 at 3:52 AM Report abuse +1 rate up rate down Reply

Is this the mac2jr show? My lord, go get a life already.

July 30 2014 at 3:50 AM Report abuse +1 rate up rate down Reply