Consumer sentiment sets record

Lower gas prices and a thriving labor market boosted consumer confidence to its highest level in two years, according to the monthly index of consumer sentiment that Reuters and the University of Michigan released today. The index increased to 96.9 last month, up from 91.7 in December and 91.2 in January 2006. The median forecast on the overall sentiment reading among analysts polled by Reuters was 98, which was in line with a preliminary January estimate of 98 made last month. (InvestmentNews, January, 19). The current economic conditions index was 11.3 in January, up from 108.1 in December and 110.3 in January 2006. The consumer expectations index stood at 87.6, compared to 81.2 in December and 78.9, during the year-ago period. "A stronger economy due to lower energy prices was anticipated by consumers to result in more jobs and higher wages during the year ahead," said Richard Curtin, the director of the Reuters/University of Michigan Surveys of Consumers, according to a statement. The survey's one-year inflation index moved up 3% in January, from 2.9% in late December, while its five-year inflation index held at 3% for the third consecutive month. The Reuters/University of Michigan Surveys of Consumers is put out on a monthly basis by the University of Michigan in Ann Arbor, Mich., in conjunction with Reuters.