Consumers are feeling better about the economy and their finances these days, likely because of surging stock prices and cheaper gas.

The Consumer Confidence Index jumped 9.6% in December, reaching its highest since July, the Conference Board, a nonprofit economics think tank,  said Wednesday. Forecasters had only expected a 3.5% uptick, according to a survey of economists by Dow Jones Newswires and the Wall Street Journal. The index, based on a monthly survey of 3,000 U.S. adults, showed confidence has recovered from its gas-price-induced summertime dive, although it hasn’t yet reached pre-pandemic levels.

Economists look to the confidence measure, based on a poll that asks people about their assessment of the outlook for the job market, business conditions, and their own incomes, for clues about how much people will spend in the future. Higher confidence generally signals more willingness to spend, which is important for the U.S. economy since consumer spending makes up most of the country’s economic output.

“U.S consumers have caught the holiday spirit, with their eggnog spiked by visions of rate cuts and soaring 401(k) plans,” Sal Guatieri, senior economist at BMO Capital Markets, wrote in a commentary. “We were expecting a return to more normal holiday shopping patterns this season after two years of stimulus-fueled gains, but the surprisingly robust pop in consumer confidence suggests a possible merrier outcome...which could well carry into the new year.”

The confidence measure tends to be heavily influenced by stock values and gas prices, Ian Shepherdson, chief economist at Pantheon Macroeconomics, wrote in a commentary. And both of those have provided good reasons for holiday cheer in recent months.

A gallon of unleaded gas averaged just over $3 nationwide, AAA said Wednesday, down from $3.89 in mid-September, and the three major stock indexes have been trending up all year and hit 澳洲幸运5官方开奖结果体彩网:or were nearing all-time highs Wednesday. Stocks have been buoyed this week by the Federal Reserve 澳洲幸运5官方开奖结果体彩网:signaling an end to its campaign of anti-inflation interest rate hikes.

Consumers’ assessment of the labor market and its future prospects also improved, in line with a 澳洲幸运5官方开奖结果体彩网:drop in the unemployment rate in November.