The European Commission said Tuesday its preliminary measure of consumer sentiment in the euro zone rose to minus 8.7 from minus 9.3 in March. The measure was last higher in October 2007, before the onset of the financial crisis.
The improvement in sentiment over recent months suggests that consumers are set to spend more freely in coming months, adding fresh support to the euro-zone economy, which has been heavily reliant on exports for the growth it has recorded since the second quarter of last year.
The rise in confidence is likely to be viewed by members of the European Central Bank's governing council as confirmation that their expectations for a sustained, if modest recovery are warranted, and that the annual rate of inflation will gradually rise from the very low levels recorded in recent months.
Retail sales rose in January and February, a sign that rising consumer confidence has begun to boost spending. But any pickup is likely to be slight, since euro-zone unemployment remains close to record highs and wages are rising very slowly.
The euro zone's economy grew for the third straight quarter in the three months to December, during which time the number of people in work rose for the first time since early 2011. Wage growth also picked up, and was faster than the rise in consumer prices, leading to a pickup in real incomes following a long squeeze on spending power.
The rise in confidence comes despite a standoff between the EU and Russia over the future of the Crimean peninsula and Ukraine. The EU has responded to Russia's actions by imposing asset freezes and travel bans on a number of high ranking officials, but hasn't yet imposed wider sanctions that would significantly disrupt trade and financial links between Russia and members of the bloc. Nor does Russia appear to be preparing to cut off energy supplies to EU members, which could hit households and businesses across the bloc.