U.S. consumer confidence improved in January to its highest in more than three years, driven by consumers' more upbeat view of the job market, a Conference Board survey showed on Tuesday.

The Conference Board said its index of consumer sentiment rose to 106.3 from a December reading of 103.8.

Economists polled by Reuters on average had forecast that the index likely rose to 104.5.

"This month's increase was driven solely by consumers' assessment of current economic conditions, especially their more positive view of the job market," said Lynn Franco, director of the Conference Board Consumer Research Center.

However, the gap between consumers' assessment of their current economic conditions and their expectations remained wide, Franco said.

The business research group's present situation index rose to 128.4 from 120.7 in December, while the expectations component decreased to 91.5 from 92.6 in December.

Consumers grew more optimistic about the jobs market at year-end, according to the Conference Board.

Consumers saying that jobs were "plentiful" rose to 26.9 percent in January from 23.3 percent in December while those who claimed that jobs were "hard to get" fell to 20.3 percent in January from 22.5 percent in December.

Sentiment indexes have traditionally been seen as a gauge of U.S. consumer spending, which accounts for roughly two-thirds of overall economic activity.