A widely watched indicator of U.S. consumer confidence unexpectedly rose for the second month in a row in January.

The Conference Board today said that its index of consumer confidence rose by 0.7 points to 103.4 in January, up from a slightly revised 102.7 in December.

Forecasters had expected a slight dip in the index.

The present-situation index, a gauge of consumers’ assessment of current economic conditions, rose to 110.9 from 105.7 the prior month.

However, an index of consumers’ expectations for the coming months dropped to 98.4 from 100.7.

Lynn Franco, director of the Conference Board’s research unit, said “consumers’ short-term outlook remains favorable and suggests the economy will continue to expand throughout the first half of the year.”

Consumer spending accounts for about two-thirds of all economic activity in the U.S.