Confidence among U.S. consumers unexpectedly increased in August as Americans grew more optimistic about the prospects for the world’s largest economy.
The Conference Board’s index of sentiment advanced to 81.5 from a revised 81 the prior month that was stronger than initially estimated, the New York-based private research group reported today. The median forecast in a Bloomberg survey of economists was 79.
Sustained job growth and increased wealth tied to higher home values and stock portfolios are helping to sustain the household spending, boosting automakers and home-improvement retailers such as Lowe’s Cos. Today’s report showed more Americans expected a pickup in employment opportunities and income gains in the next six months.
“The household sector is still improving and a lot of that improvement comes from home prices,” said Sam Coffin, an economist at UBS Securities LLC in Stamford, Connecticut. UBS Securities is the top forecaster of the Conference Board’s index in the last two years, according to data compiled by Bloomberg.
Estimates for consumer confidence ranged from 74.3 to 82 in the Bloomberg survey of 71 economists after an initial July reading of 80.3. The measure averaged 53.7 during the recession that ended in June 2009. The cutoff date for the Conference Board’s survey was Aug. 15.
Stocks held losses on growing tension over possible military action in Syria. The Standard & Poor’s 500 Index dropped 0.8% to 1,643.03 at 10:13 a.m. in New York.
Another report today showed home prices increased at a slower pace in June. The S&P/Case-Shiller index of property values advanced 12.1% from the same month in 2012 after rising 12.2% in the year ended in May, the biggest gain since March 2006.
The Conference Board’s measure of expectations for the next six months rose to 88.7 from 86. The gauge of present conditions decreased to 70.7 this month from 73.6 in July.
The share of Americans expecting business conditions to improve rose to 20.1% this month from 19.9%.
The% of respondents expecting jobs to become more available in the next six months climbed to 17.6 from 16.7.
The share of those who say jobs are currently hard to get decreased to 33%, the lowest since September 2008, from 35.2%. The difference in the shares of those saying employment opportunities are currently plentiful and people indicating positions are hard to get was the narrowest since September 2008.