(Bloomberg News) Consumer confidence in the U.S. climbed last week to a one-year high, spurred by improving employment opportunities and a rally in the stock market.
The Bloomberg Consumer Comfort Index rose to minus 41.7 in the period to Feb. 5 from minus 44.8 the previous week. Confidence among political independents, considered a key group in presidential elections, increased to a four-year high.
Americans' views of the economy were the least pessimistic in eight months after employers beefed up payrolls in January and joblessness fell to the lowest level since February 2009. Consumers may be looking beyond the recent rise in gasoline prices as the increase in equity values boosts household wealth and promotes spending.
"Encouraging labor-market gains over the past two months are the likely catalyst for the sharp improvement," said Joseph Brusuelas, a senior economist at Bloomberg LP in New York. "Declining natural gas and home heating oil prices are likely offsetting rising gasoline prices, which has probably bolstered consumer balance sheets along with consumer sentiment."
Fewer Americans than forecast filed claims for unemployment insurance payments last week, indicating the labor market recovery is gaining traction, figures from the Labor Department showed today. Applications for jobless benefits decreased by 15,000 in the week ended Feb. 4 to 358,000. The median forecast of 48 economists surveyed by Bloomberg News projected 370,000.
There were 366,250 claims filed on average over the past four weeks, the fewest since April 2008.
Stocks advanced as Greek political leaders struck a deal on a package of austerity measures needed to secure international rescue funds. The Standard & Poor's 500 Index climbed 0.1 percent to 1,350.84 at 9:40 a.m. in New York.
All three components of the weekly consumer comfort index improved from the prior week. The measure of Americans' views of the state of the economy rose to minus 76.6 last week from minus 79.1. The gauge of personal finances climbed to zero, the highest since July, from minus 4.5. An index of the buying climate increased to minus 48.4 from minus 50.8.
The Bloomberg comfort survey has a 3-point margin of error, and the index has been stuck below minus 40 -- the level associated with recessions or their aftermath -- since the end of February 2011. The confidence gauge, which began December 1985, averaged minus 46.8 last year, compared with minus 45.7 for 2010 and minus 47.9 in 2009, the worst full-year reading on record.
Forty-one percent of survey respondents said the economy is in "poor" shape, the fewest since March. Half of the respondents rated their own finances as "positive," the most since September.