NEW YORK (REUTERS) - US consumer sentiment rose in July to the highest level in six years as Americans felt better about the current economic climate, though they expected to see a slower rate of growth in the year ahead, a survey released on Friday showed.

The Thomson Reuters/University of Michigan's final reading on the overall index on consumer sentiment climbed to 85.1 from 84.1 in June, topping expectations for 84.

It was the highest level since July 2007 and was also an improvement from July's initial reading of 83.9.

"This high level of confidence points toward a continued expansion of consumer spending in the year ahead," survey director Richard Curtin said in a statement.

Still, there were a number of cross-currents among consumers' attitudes amid expectations interest rates will rise.

Future prospects for the economy were judged slightly less favourably, while lower income households were more optimistic than higher income earners.

The survey's barometer of current economic conditions also hit the highest level in six years on a final reading basis, jumping to 98.6 from 93.8. But the gauge of consumer expectations was less robust, slipping to 76.5 from 77.8.

Increasing expectations that interest rates will rise have prompted consumers to pick up the pace of their purchases. The index of buying conditions for durable goods rose to 149 from 143, while 68 per cent of consumers expected rates to rise in the coming year, up from 55 per cent in June.

That made for the highest proportion to expect interest rate hikes since August 2006.

The survey's one-year inflation expectation rose to 3.1 per cent from 3 per cent, though the survey's five-to-10-year inflation outlook fell to 2.8 per cent after holding at 2.9 per cent for three months.