U.S. consumer sentiment rises to highest level since 2004

WASHINGTON, March 29 (Xinhua) -- U.S. consumer sentiment in March rose to the highest level since 2004 as U.S. economy continued to grow steadily, according to a survey released by the University of Michigan on Thursday.

The index of consumer sentiment rose from 99.7 in February to 101.4 at the end of March, the highest since 2004, the survey showed.

"Consumers remain confident in their future job and income prospects," said Richard Curtin, chief economist of the survey.

But the figure was marginally below the preliminary reading of 102 in mid-March "due to uncertainty about the impact of the proposed trade tariffs", said Curtin, noting American households with incomes in the top third cited "significantly greater concerns" with U.S. trade policies than last month.

Curtin said American consumers also expect higher interest rates in the foreseeable future, which could slow future economic growth.

"While consumers view the current level of interest rates as still relatively low, they understand that interest rate hikes are intended to dampen the future pace of economic growth," he said.

"Their reaction will both emphasize borrowing-in-advance of those expected increases as well as heighten their precautionary savings motives," Curtin explained, adding the trade-off between spending and saving will depend on the pace of future interest rate hikes compared with the pace of income growth. Enditem