Job hopes lift US confidence

Will higher confidence boost spending?

Consumer confidence in the US has risen thanks to an improvement in job market conditions, a survey has said.

The latest study from the Conference Board, a private research group, found its consumer confidence index rising to 81.1 in October, up from a revised 77 in September.

"A more favourable job market was a major factor in the turnaround," said Lynn Franco, director of the board's consumer research centre.

There was a further boost for the US economy from durable goods figures, which showed a rise in business spending.

Picking up?

Despite increasing signs of recovery in the US economy, unemployment has remained stubbornly high.

With the holiday season around the corner, this improvement in consumers' spirits is a good omen for upcoming retail sales Lynn Franco, Conference Board

However, the Conference Board's latest findings suggest consumers perceive the situation is improving.

The Board's "jobs hard to get" index fell to 33.8 in October from 35.1 the previous month.

This helped lift the current conditions index from 59.7 to 66.8, and also boosted consumers' future expectations.

"With the holiday season around the corner, this improvement in consumers' spirits is a good omen for upcoming retail sales," Ms Franco said.

Investment rising

Separate figures from the US Commerce Department on Tuesday showed a slight increase in orders for durable goods.

Orders rose by 0.8% in September, the Commerce Department said, and by 2.6% when orders for defence goods were stripped out.

Analysts were encouraged by signs of a pick-up in business spending.

Orders of computers and other electronic goods rose 2.6% and there was a 5.8% increase in demand for communications equipment.