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Consumer confidence rises sharply

NEW YORK — NEW YORK - Consumer confidence in the U.S. economy surged in June to the highest level in two years, spurred by job gains and falling gasoline prices, a private survey found.

The Conference Board's Consumer Confidence Index rose to 101.9 this month, from a revised 93.1 in May. The figure exceeded the highest estimate in a Bloomberg News survey of economists. The percentage of consumers who said they found jobs hard to find was the lowest level since September 2002.

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The economy has added 1.2 million jobs this year and economists expect more were added this month, boosting incomes and fueling expectations that the Federal Reserve will raise lending rates today to stem inflation. Growing confidence in the economy may help President Bush's re-election bid.

"Money in your pocket speaks the loudest," said Ellen M. Beeson, an economist at Bank of Tokyo-Mitsubishi in New York. "Consumer perceptions of the labor market have finally caught up and are outweighing concerns over Iraq and energy prices."

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Federal Reserve policy-makers are predicted to raise their benchmark interest rate today by a quarter-point to 1.25 percent to keep inflation from accelerating.

Economists had expected the June confidence index would rise to 95, from May's previously reported reading of 93.2. The index averaged about 103 during the record expansion from 1991 to 2001.

The percentage that saw business conditions as "good" rose to 25.6 in June, the highest since August 2001, the Conference Board said. More people, 19.3 percent, said they expected their incomes to increase in the next six months, the most this year.

The Conference Board confidence index surveys 5,000 households about general economic conditions, employment prospects and spending plans.


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