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Buoyant spirits set to bolster U.S. consumer spending in near-term

Staff Writer |
Consumers in the States remained in a buoyant mood in May. The Conference Board's U.S. consumer confidence index recovered from a dip during the prior month to reach a reading of 128.0 for May.

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Economists had forecasts a reading of 127.9, down from a preliminary print of 128.7 for the month before.

Between March and April, the gauge had retreated from 127.0 to a downwardly-revised 125.6.

A sub-index linked to consumers' perceptions of the current economic situation jumped from 157.5 to 161.7 - a 17-year high.

That, said Lynn Franco, Director of Economic Indicators at the Conference Board, hinted at continued support for "solid" consumer spending but with the rate of economic growth unlikely to gain momentum during the second quarter.

"Consumers' short-term expectations improved modestly, suggesting that the pace of growth over the coming months is not likely to gain any significant momentum," she said.

"Overall, confidence levels remain at historically strong levels and should continue to support solid consumer spending in the near-term."

In particular, the proportion of Americans who believed current business conditions were "good" jumped from 34.8% in April to 38.4% for May.

There was also a large increase in the proportion of those who believed that jobs were "plentiful", which increased from 38.2% to 42.4%.

Opinions regarding the outlook for business conditions and the labour market over the next six to nine months on the other hand were more mixed, but were generally improved.

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