The U.S. consumer confidence index for January came in a little higher than expected today, indicating that consumer spending should hold up.

The index, as measured by the Conference Board, came in at 97.3. This is up 2.7 points from the prior month and BMO Nesbitt Burns says it was a bit above consensus expectations, but well in line with the flow of other economic reports. “As has been the case recently, current conditions readings were not the source of the gain. People have become considerably more optimistic about future prospects, as the expectations component surged 4.5 points to 96.9, the highest in over a year.”

Labour market indicators were mixed, BMO notes, “but we see several special factors that will push up Friday’s employment numbers. The employment expectations question shows households look for a thawing in job markets over the next six months.”

“All told, this was a good, forward-looking report that is consistent with consumer spending holding up decently (further strong growth would be too much to hope for) and with the Fed staying on hold.”