US consumer confidence up sharply in August

US consumer sentiment in August rose to its highest level in almost a year, with the public's optimism about jobs and income showing improvement, the Conference Board reported Tuesday.

The monthly consumer confidence index was at 101.1, up from 96.7 in July, which had seen a marginal decrease from June.

Analysts had forecast a reading of only 97.0 for this month.

"Consumers' assessment of both current business and labor market conditions was considerably more favorable than last month," Lynn Franco, the Board's head of economic indicators, said in a statement.

"Short-term expectations regarding business and employment conditions, as well as personal income prospects, also improved, suggesting the possibility of a moderate pick-up in growth in the coming months."

The share of consumers expecting business conditions to rise in the next six months rose from 15.7 percent to 17.3 percent. Those expecting things to worsen became less numerous, falling from 12.4 percent to 11.1 percent.

According to Blerina Uruci of Barclays Research, the higher reading suggests consumer spending will be on the upswing.

"The August data suggest that household confidence has fully recovered from the soft patch in April and May," she said in a research note.

"We see this improvement as constructive for (third quarter) spending growth."