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Last Updated: Friday, 20 January 2006, 16:24 GMT
Energy prices boost US sentiment
US shopper with two trolleys
Consumer spending is a major factor in the US economy
Steadying energy prices helped to improve consumer sentiment in the US during January, according to the University of Michigan's index.

It rose for the third month in a row to 93.4 from December's final reading of 91.5, ahead of analysts' predictions.

Better job conditions and an optimistic outlook for US stocks during 2006 also helped push the index higher.

Consumer spending makes up two-thirds of US economic activity and is a key indicator of the health of the economy.

Elisabeth Denison, economist at Dresdner Kleinwort Wasserstein in New York, said: "The headline was a bit better than expected. It did come in stronger, so that's probably good news in terms of consumer momentum as we go into the new year."

Jobs boost

The dollar rose against the yen and firmed against the euro shortly after the report was issued on Friday.

Meanwhile, data from the Energy Information Administration (EIA) shows heating oil prices have fallen in recent weeks, amid mild weather in the US.

Retail heating oil prices fell to a five-week low at $2.43 a gallon, down 1.7 cents from a week ago but up 46 cents from a year ago, EIA said.

On Thursday, the number of new jobless workers fell to 271,000 last week, its lowest level since April 2000, the Labor Department said.




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