US consumer confidence rises more than forecast

US consumer confidence rose more than expected in October, data from the Conference Board showed on Tuesday, despite recent volatility in global capital markets.

The cut-off date for the survey was 16 October, two days after the S&P 500 touched its lows for the month.

The headline consumer sentiment index increased to 94.5 this month from 89 a month earlier, impressing analysts who had predicted a reading of 87.

The data comes ahead of Wednesday's Federal Reserve policy decision. The central bank is expected to end its monthly bond purchase programme amid signs of a healthy economy. Interest rates are forecast to remain unchanged.

A gauge of consumer expectations increased sharply, reaching the 95 point mark after a print of 86.4 in the month before.

The current conditions sub-index rose to 93.7 from 93 in September.

Conference Board Director Lynn Franco said the key to the improvement seen in perceptions of the current situation was a more favourable assessment of the current job market and business conditions. As regards expectations, consumers have recovered confidence in the short-term outlook for the economy and labour market.

They are also more optimistic as regards their future earnings potential, Franco added.

The proportion of consumers expecting growth in their incomes rose from 16.9% in September to 17.7% in October, while the proportion expecting a drop in income fell from 13.4% to 11.6%.