Consumer confidence rises as job, housing markets improve
By PAUL WISEMAN Associated Press on Aug 28, 2013, at 2:27 AM Updated on 8/28/13 at 3:25 AM
The housing market's recovery has contributed to a rise in consumer confidence. U.S. home prices were up 12.1 percent in June from a year earlier, according to a report released Tuesday. Associated Press file
Real Estate
U.S. homebuilders' confidence in the housing market held this month at its highest level in nearly eight years. But builders are starting to worry that sales may slow if mortgage rates continue to rise.
New home construction in the Tulsa region from January to August is outpacing last year's numbers, a continuation of the upward tick that started in 2012 following a six-year slide.
WASHINGTON - Americans' confidence in the economy inched closer to a 5 1/2-year high on growing optimism that hiring and wages could pick up in coming months.
The Conference Board, a New York-based private research group, said Tuesday that its consumer confidence index rose to 81.5 in August. That's up from a revised reading of 81 in July. And it's just below the 82.1 reading in June, which was the highest since January 2008.
Consumers' income expectations, which fell earlier this year after a January tax hike, rebounded to the highest level in 2 1/2 years, said Lynn Franco, director of the Conference Board's economic indicators.
Although consumers were more confident about the future, their assessment of the current economy dipped slightly in August.
"Consumer sentiment is holding steady, supported by advances in stocks, solid job creation, and a broad-based recovery in the housing market," Jim Baird, chief investment officer at Plante Moran Financial Advisors, wrote in a research note.
U.S. home prices were up 12.1 percent in June from a year earlier, nearly matching a seven-year high, according to the Standard & Poor's/Case-Shiller 20-city home price index, released Tuesday. The index slowed only marginally from May's year-over-year gain of 12.2 percent, the fastest since March 2006.
Consumers' confidence in the economy is watched closely because their spending accounts for about 70 percent of U.S. economic activity.
After hitting bottom at 25.3 at the depths of the Great Recession in February 2009, the index has bounced back. But it has yet to get back to the 90 reading that signals a healthy economy.
The U.S. economic recovery has been held back this year by tax hikes, federal spending cuts and weaker global growth. The economy expanded at just a 1.7 percent annual rate in the April-June quarter. Most economists expect that figure will be revised up to a 2.2 percent annual rate, mostly because of a jump in June exports.
Most analysts predict growth may pick up to about a 2.5 percent annual rate in the second half of the year.
Original Print Headline: Confidence index nears five-year high
Real Estate
U.S. homebuilders' confidence in the housing market held this month at its highest level in nearly eight years. But builders are starting to worry that sales may slow if mortgage rates continue to rise.
New home construction in the Tulsa region from January to August is outpacing last year's numbers, a continuation of the upward tick that started in 2012 following a six-year slide.
