Consumer confidence hits highest level since December 2000
- Consumer confidence rose to 125.9 in October, according to the Conference Board.
- The rating is at the highest level since December 2000.
- This accounts for Americans' views of current economic conditions and their expectations for the next six months.
Consumers were even more optimistic in October than economists polled by Reuters expected.
Consumer confidence rose to 125.9 in October, according to the Conference Board.
The index "increased to its highest level in almost 17 years," Lynn Franco, Director of Economic Indicators at The Conference Board, said in a statement. That was in December 2000, when the index hit 128.6.
The surge in confidence comes at a time when U.S. share prices have hit record highs. Stocks have been lifted by strong economic growth, a surge in corporate earnings and increasing expectations of tax reform. On Tuesday, stocks traded slightly higher, near all-time highs.
The economic weight of Hurricanes Harvey and Irma pulled down the spirits of U.S. consumers in September, when the index was relatively flat. In October, "consumers' assessment of current conditions improved," Franco said.
"[This was] boosted by the job market which had not received such favorable ratings since the summer of 2001," Franco said.
The high level of confidence suggests the economy will continue to expand "at a solid pace" for the rest of 2017, Franco added.
The index takes into account Americans' views of current economic conditions and their expectations for the next six months. Economists pay close attention to the numbers because consumer spending accounts for about 70 percent of U.S. economic activity.
President Donald Trump's goal of 3 percent growth has been realized in two of the three quarters since he took office, and economists say the trend can keep going for at least another quarter and possibly longer.
Third-quarter GDP grew by 3 percent, well above the 2.5 percent expected by economists surveyed by Thomson Reuters and below the 2.8 percent in the CNBC/Moody's Rapid Update. The third-quarter number comes on top of 3.1 percent growth in the second quarter, making for the best back-to-back quarters since 2014 and ending a long streak of sluggish 2 percent growth.