By CHRISTOPHER S. RUGABER
WASHINGTON (AP) â¿¿ A measure of U.S. consumer confidence stayed near a six-year high in June as higher home prices boosted household wealth. The survey shows Americans remain upbeat about the economy, despite wild gyrations in the stock market.
The University of Michigan said Friday that its final reading of consumer sentiment in June was 84.1. That's an improvement from a preliminary reading of 82.7 issued on June 14. And it is just slightly below May's final reading of 84.5, which was the highest since July 2007.
Rising household wealth was the main reason consumers stayed optimistic. Households with income above $75,000, those more likely to own homes and stocks, reported the biggest gain.Consumers' confidence is closely watched because their spending accounts for 70 percent of economic growth. Stocks pared steep early morning losses after the report was released. The Dow Jones industrial average, which was down as much as 140 points at one point, rebounded to 53 points lower at midday. The University of Michigan polls roughly 500 people throughout the month and issues two readings. The slight improvement from the preliminary survey suggests consumers were unfazed by Federal Reserve Chairman Ben Bernanke's June 19 comments about the Fed's bond purchases. Bernanke said the Fed could start to slow its bond buying by the end of the year and end it next year, if the economy continues to strengthen. The bond purchases have kept long-term interest rates low. Stocks fell sharply in the days after Bernanke's comments and interest rates jumped. The average rate on the 30-year fixed mortgage surged this week to a two-year high of 4.46 percent. That's up from 3.93 percent last week and a full point higher than a month ago. "Consumers remain optimistic despite recent market volatility and a back-up in mortgage rates," said Yelena Shulyatyeva, an economist at BNP Paribas.