The Commission said consumer confidence in the 19 countries sharing the euro in January rose to 1.3 points from 0.5 points in December, well above market consensus of an increase to 0.6. This is the highest level of the indicator since August 2000.

In the wider European Union, confidence jumped 1.0 point to 0.4 points, the Commission said. This was the highest level since January 2001.

"The outlook for domestic demand remains very favourable, confirming our expectations of continued strong GDP growth early in the year," ING bank economist Bert Colijn said.

"The current mood among consumers is nothing short of ecstatic and current levels of confidence are generally associated with further acceleration in household consumption growth," he said.

He said uncertainty about possible euro zone reforms, Italian elections and the success of the German coalition negotiations were clearly taking a backseat to improved economic factors. Unemployment in the euro zone is at nine-year lows.

Colijn said that, while unemployment expectations have become slightly less favourable over the last months of 2017, businesses were signalling they expected to hire.

"With such a favourable outlook, it could well be that the record for consumer confidence could be breached a few more times in 2018. This, in turn, confirms the rosy short-term picture for Eurozone growth," he said.

The highest level of the index, which dates back to 1985, was the 2.1 points hit in May 2000.

(Reporting By Jan Strupczewski; editing by Philip Blenkinsop)