NEW YORK (AP) — A private research group says that consumer confidence in February rose dramatically from last month to the highest level since a year ago when the U.S. economy's outlook started to look brighter before souring again.
The Conference Board's Consumer Confidence Index now stands at 70.8, up from a revised 61.5 in January, helped by consumers' improving assessment of the job market. Analysts had expected a reading of 63. The February reading marks the highest level since February 2011 when it was 72.0.
The index, which is closely watched because consumer confidence makes up the majority of U.S. economic activity, is still far below the 90 that indicates a healthy economy. But it's closer to levels that indicate a steady economy than not. The index has risen slowly since hitting an all-time low of 25.3 in February of 2009. And in the past 12 months, it's jumped from the high 60s to the low 40s amid continued worries about the health of the U.S. economy.
"Consumers are considerably less pessimistic about current business and labor market conditions that they were in January," said Lynn Franco, director of The Conference Board Consumer Research Center in a statement. "Despite further increases in gas prices, they are more optimistic about the short-term outlook for the economy, job prospects and their financial situation."
One gauge of the Consumer Confidence Index, which measures how shoppers feel now about the economy, rose to 45.0 from 38.8. The other gauge, which measures shoppers' assessment over the next six months, jumped to 88.0 from 76.7 in January.
According to the survey of consumers, conducted from Feb. 1 through Feb. 15, shoppers are optimistic about the job market. Those anticipating more jobs in the months ahead increased to 18.7 percent from 16.4 percent, while those anticipating fewer jobs declined to 16.9 percent from 19.1 percent.
There are reasons for optimism. The government says 243,000 jobs were added in January, pushing down the unemployment rate to 8.3 percent, the lowest in three years. Unemployment has fallen five months in a row for the first time since 1994. Job figures for February are due out next week.
Even the housing market, though still weak, is showing signs of recovery. Home values remain depressed, according to the latest snapshot from a widely followed Standard & Poor's/Case-Shiller home price index. But more people signed contracts to buy homes in January than in nearly two years, according to seasonally adjusted figures from The National Association of Realtors.
But there also are reasons for caution. The European debt crisis threatens to hurt the U.S. economy. And rising gas prices could limit spending by middle- and lower-income shoppers. The average U.S. price of a gallon of gasoline rose 18 cents to $3.69 from two weeks earlier, according to the Lundberg Survey of fuel prices released Sunday.
The Consumer Confidence Index now stands at 70.8, up from 61.5 in January, while analysts had expected a reading of 63.