Florida's consumer confidence in the economy unexpectedly surged in January to the highest level in more than two years, but researchers behind the numbers think the bounce will be short-lived.
The Florida results released Tuesday align with national consumer confidence, which rose in January for the third straight month. The Conference Board's Consumer Confidence Index reached 55.9, the highest level in a year but still relatively gloomy.
"The sharp rise (in Florida's index) was somewhat of a surprise," Chris McCarty, said survey director at the University of Florida's Bureau of Economic and Business Research.
"In the past we have seen similar jumps in the January index, perhaps in response to the financial stress associated with the holidays and the economic turbulence of the past year."
McCarty said the 5-point jump in consumer confidence to 74 benefitted from having one week's less worth of data for consumers to digest. It didn't reflect consumer reaction to the latest labor data showing Florida's unemployment has risen to 11.8 percent. Nor did it gauge potential changes to health care reform as a result of the Republican Party's win in the Massachusetts senatorial race.
"We believe that once we have collected an extra week's worth of data (for the end of the month), consumer confidence will edge downward," McCarty said.
January's increase in consumer confidence was broad-based across age and income levels.
All five components making up the index increased, with the biggest jump coming in those who perceive its a good time to buy big-ticket consumer items. That rose eight points to 83. Perceptions of personal finances now compared with a year ago increased five points to 50, while expectations of personal finances a year from now rose five points to 85. Perceptions of U.S. economic conditions over the next year rose six points to 73, while perceptions of U.S. business conditions over the next five years rose four points to 78.
January's overall index was the highest since December 2007. The index, which is based on telephone surveys, is benchmarked to 1966, meaning a value of 100 represents the same level of confidence for that year.