US consumer confidence rises

Every word of Alan Greenspan's testimony is scrutinised

US consumer confidence figures were much stronger than expected in March, with the index rising 8 points to 117.

It is the first rise in the Conference Board survey after five months of steady decline.

The news gave a boost to US stock markets which had been expecting March confidence to be closer to the 100 mark.

It seems that Federal Reserve chief Alan Greenspan's move to cut interest rates three times this year has had the desired effect of shoring up consumer confidence.

"The rebound in consumer confidence was triggered by an improvement in the economic outlook for the next six months and employment prospects," said Lynn Franco, director of the Conference Board's Consumer Research Centre.

The figure is based on a representative sample of 5,000 US households.

But statistics for durable goods such as refrigerators and cars, also released on Tuesday, were not so positive.

Relief

New orders for costly US manufactured goods fell modestly by 0.2% in February after a steep decline of 7.3% the previous month.

This report was weaker than expected with economists expecting durable goods orders to be unchanged in February.

But improved consumer confidence should help relieve fears that the US is entering a recession.

US investors were not given any new direction from Mr Greenspan at a speech to the National Association of Business Economists in Washington on Tuesday.

Mr Greenspan's testimony, which is scrutinised by stock markets around the world, did not refer to either the state of the economy or hint at future interest rate cuts.

At 1523 GMT, the US stock markets were modestly higher.

The Dow Jones Industrial Average was up 32 points at 9720, while the Nasdaq was up 28 points higher at 1,947.