NEW YORK – A key gauge of U.S. consumer sentiment bounced higher in early December, market sources said Friday, as a rising stock market and hopes for an economic recovery overshadowed mounting worries about job layoffs.
The University of Michigan's closely-watched consumer sentiment index rose for a third straight month to 85.8 in early December from 83.9 in November. That was higher than consensus forecasts for 84.1 and well above its recent low of 81.8 struck in September.
Economists closely watch the sentiment index, which has fallen sharply from its peak of 112.0 in early 2000 as the economy slowed, as it can give clues about consumer behavior. Consumer spending underpins about two-thirds of U.S. economic activity and is critical during the holiday shopping season.
The current conditions index, which gauges consumers' read on their present financial situation, edged up to 95.9 in early December from 95.3 in November. The expectations index, which tracks consumer attitudes about the next 12 months, rose to 79.3 in December from 76.6 in November.
The preliminary consumer sentiment survey is based on telephone interviews with roughly 250 Americans across the country on personal finances, business conditions and buying conditions. A final report rounds out the data at month's end.