Confidence among consumers rose in December to its highest level since June, on improved job prospects and larger discounts from retailers, a survey released on Thursday showed.

The Thomson Reuters/University of Michigan's final reading on the overall index on consumer sentiment came in at 74.5, up from 71.6 in November.

It was slightly below the median forecast of 74.7 among economists polled by Reuters.

The overall tenor of news about recent economic developments was on balance more favorable than at any time during the past six years, wrote Richard Curtin, the survey's director.

Twenty-seven percent of consumers spontaneously reported upbeat news about employment gains, the highest proportion since 1983, he wrote.

The survey's barometer of current economic conditions was 85.3 in December, up from 82.1 percent in November but below a forecast of 86.

The survey's gauge of consumer expectations, which more closely projects the direction of consumer spending, rose to 67.5, also the highest level since June. That was above November's 64.8 percent, and in line with expectations.

Households said they expect an inflation rate of 3 percent a year from now, unchanged from November. Americans' forecast for inflation over the next five years held at 2.8 percent for a third month in a row.

(Reporting by Kristina Cooke, Editing by Chizu Nomiyama)