Consumer confidence strengthens in July, beating expectations for a drop

  • The Consumer Confidence Index rose to 121.1 in July.
  • Economists surveyed by Reuters expected 116.5, a drop from June.
  • Consumer optimism remains at a 16-year high.

The Consumer Confidence Index rose in July to 121.1 to a 16-year high, despite expectations for a drop, The Conference Board announced Tuesday.

Economists polled by Reuters forecast the major indicator of consumer optimism to decline to 116.5 in July. Instead, consumer confidence remains at the highest level since July 2001.

"Consumers foresee the current economic expansion continuing well into the second half of this year," Lynn Franco, The Conference Board's director of economic indicators, said in a statement.

The Consumer Confidence Index beat expectations last month as well. In July, consumers said jobs were even more "plentiful" than last month's report, up to 34.1 percent from 32 percent, while also saying jobs were not as "hard to get."

Consumers found the current environment to be improving. The Conference Board reported those saying business conditions are "good" increased from 30.6 percent to 33.3 percent, while the number who assessed business conditions to be "bad" was virtually unchanged at 13.5 percent.

The July short-term outlook was also more positive, as the percentage of consumers expecting better business conditions over the next six months improved to 22.9 percent, from 20.1 percent in June.