The Bloomberg Consumer Comfort Index averaged 36.7 in 2014, the strongest in seven years. While the gauge slipped to 42.7 in the week ended Dec. 28 from 43.1, it was the second-highest level since October 2007.
After an erratic nine months, sentiment began to steadily improve as stronger employment gains and lowest fuel costs in five years began resonating with American consumers. Households last week had the most optimistic view of the economy since the end of 2007, indicating the expansion has room to run in 2015.
"The advances in the CCI align with recent positive economic news, including improving labor conditions, wages and economic output, as well as falling gas prices," Gary Langer, president of Langer Research Associates LLC in New York, which produces the data for Bloomberg, said in an e-mailed statement.
Another report today showed more Americans filed applications for unemployment benefits for the first time in five weeks. The Labor Department said jobless claims rose by 17,000 to 298,000 in the week ended Dec. 27. The median forecast in a Bloomberg survey called for 290,000 claims.
Stocks were little changed on the last trading day of the year that capped the biggest bull market since the 1990s. The Standard & Poor's 500 Index rose 0.1 percent to 2,082.35 at 9:33 a.m. in New York.
Economy View
The Bloomberg Comfort component measuring attitudes about the national economy climbed to 35.2 last week, the strongest level since October 2007, from 34.7. The gauge, which tends to reflect less optimism than the other two sub-indexes, is still lower than its pre-recession average of 40.1.
The Bloomberg measure of personal finances declined to 53.8, the lowest since late October, from 54.7 the week before. Attitudes about the buying climate were little changed near its highest level since April 2007.
A comfort gauge among earners making $50,000 or more advanced 59.7, the highest since August 2007 and 10 points better than this year's average.
Sentiment among 18-to-34-year olds, high school graduates, single adults, Westerners and part-time workers was the strongest since 2008.
Other Measures
The figures corroborate other measures. The Conference Board's consumer confidence index increased to 92.6 in December, as the measure of current conditions advanced to the highest in almost seven years.
Americans have been more successful finding work. In November, employers took on a net 321,000 jobs, Labor Department data showed. The economy has added 2.7 million workers so far this year, the most since 1999. The jobless rate stands at 5.8 percent, the lowest in more than six years.
Low gas prices have boosted consumers' discretionary income. The cost of a gallon of regular gasoline averaged $2.26 yesterday, the least since 2009, according to figures from AAA, the nation's largest motoring group.
"The gas prices should be putting more discretionary income into the pockets of the core consumer, where that really could make a material difference," Gary Rodkin, chief executive officer of ConAgra Foods Inc., an Omaha, Nebraska-based food processor, said on a Dec. 18 earnings call. "We hope they are going to spend some more of that on the food side, both at home and away from home."
The Bloomberg Comfort Index has been presented on a scale of zero to 100 since May, rather than the previous minus 100 to 100, with the midpoint shifting to 50 from zero. The change is also reflected in the gauge's components. It doesn't affect the measures' relationship to each other or their correlation with other economic indicators. Historical data have been revised and analysis of trends, values and other variables also aren't affected.
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