May 26 (Bloomberg) -- Confidence among U.S. consumers jumped this month to the highest level since September, reflecting growing perceptions that the job market will improve.
The Conference Board’s sentiment index surged to 54.9, higher than forecast and the biggest gain since April 2003, the New York-based research group said today. Another report showed home prices continued to plunge.
Recent jumps in the stock market, low mortgage rates and smaller job losses are brightening consumers’ outlooks and fueling forecasts that the economy will return to growth in the second half of the year. Still, the loss of wealth from the slump in real estate values and still-tight credit may temper a comeback in consumer purchases, muting the recovery.
“News that things are improving in the economy is helping consumer sentiment,” James Knightley, an economist at ING Financial Markets in London, said before the report. “We’ve seen stock prices rise in recent weeks and mortgage rates have fallen.”
