US consumer morale at 3-year high

Consumer confidence has surged for two months

US consumer confidence hit a three-year high in June, rising strongly for the second month in a row.

Consumers were more confident about employment, suggesting they will keep on shopping and buoy economic growth.

The Conference Board's well-respected consumer confidence index rose to 105.8 in June, up from 103.1 for May.

The number of people saying jobs were "hard to get" fell from 24.1% to 22.6% - showing people are more confident about their employment prospects.

Retail spending makes up two-thirds of the US economy, so consumer confidence is an important barometer of economic growth prospects.

Separately, US Treasury Secretary John Snow said that energy prices were "way too high" and "hurting", but would not derail "the strong recovery we're in".

'Better spirits'

"This improvement in consumers' mood suggests that business activity and labour market activity will continue to pick up over the next several months," said Lynn Franco, who heads the Conference Board's Consumer Research Centre.

"With consumers in better spirits, and job concerns remaining relatively steady, there is little reason to expect a dramatic shift in consumers' spending," she added.

US stock markets were higher on Tuesday in response to the forecast-busting confidence data, coupled with a lull in rapidly rising oil prices - which dipped slightly to hover just below $60 a barrel.

"These numbers are consistent with solid growth in consumer spending," said UBS Securities economist James O'Sullivan.

"The ups and downs in oil prices haven't really affected consumer spending all that much."

In an interview with CNBC TV channel, Mr Snow said high energy prices would "take some oxygen out of the economy" by reducing people's disposable income, but predicted they would have only a marginal impact on growth.