U.S. Consumer Confidence Confounds Experts

Ordinary Americans knew better than what the experts said, certainly with respect to the direction in which their economy is heading.

Figures released Tuesday by the U.S. Conference Board revealed that the Consumer Confidence Index rose in July to 121.1 to a 16-year high, despite analysts expecting a downward number.

Economists had forecast the major indicator of consumer optimism to decline to 116.5 in July. Instead, consumer confidence remains at the highest level since July 2001.

The Consumer Confidence Index beat expectations last month as well. In July, consumers said jobs were even more "plentiful" than last month's report, up to 34.1 percent from 32 percent, while also saying jobs were not as "hard to get."

Consumers found the current environment to be improving. The Conference Board reported those saying business conditions are "good" increased from 30.6% to 33.3%, while the number who assessed business conditions to be "bad" was virtually unchanged at 13.5%.

The July short-term outlook was also more positive, as the percentage of consumers expecting better business conditions over the next six months improved to 22.9%, from 20.1% in June.