Consumer confidence hits seven-year high

Consumer confidence rose to a seven-year high in August for the second straight month.

The Conference Board's closely watched index of consumer confidence increased to 92.4 this month from 90.3 in July. Both the July and August readings were the highest since October 2007.

The index has risen four months in a row.

Consumers' outlook has been buoyed recently by a stock market rally, six straight months of 200,000-plus job gains and falling gasoline prices.

The rise in August was driven by substantial improvement in consumers' perceptions of current conditions. The share saying jobs are "plentiful" increased to 18.2% from 15.6%. Those saying jobs are "hard to get" dipped to 30.6% from 30.9%.

Americans' near-term expectations declined slightly. Those anticipating more jobs over the next six months will fell to 17% from 18.7%. The portion expecting fewer jobs also slipped, however, to 15.8% from 16.6%.

In a research note, RDQ Economics said the encouraging confidence reading, along with initial jobless claims that continue to fall, "point to a strong August employment report."

"Consumers are pulling out of their prolonged funk," RDQ wrote.

Their more favorable views of the economy have not translated into stronger spending recently. Retail sales were fla in July.