Danish consumer confidence reached a seven-year high point in June, Statistics Denmark said on Friday, boosting hopes that the recovery in Scandinavia's weakest economy is finally gathering pace.
As more households felt their financial situation would improve in the coming year, the index rose from 7.8 in May to 9.3 this month, a level it hasn't hit since June 2007.
That year, consumer sentiment began to sour as the housing market began a protracted slide that brought down prices by almost 25 percent.
It led to the country dipping in and out of recession for several years, in sharp contrast with neighbouring Norway and Sweden, which have been two of Europe's strongest performers during the financial crisis.
Danish growth returned in the first quarter, but the 0.9-percent increase in economic output was partly due to insurance companies' payouts following two storms in the previous quarter.
The government nonetheless said that "there are many signs that growth is returning" and that it believed growth will reach 1.5 percent this year and 2.0 percent next year.
Unemployment in Denmark fell to five percent in April, its lowest level since June 2009, owing to a stronger property market and a pick-up in exports.
Consumer spending has remained relatively weak however, as Danes continue to struggle with the highest level of per capita private debt in the world.
Danish retail sales rose by just 0.4 percent in May from the previous month, but nonetheless attained their highest level in two years, Statistics Denmark said.
"Growing confidence gives hope that consumer spending may begin to act as a powerful driver of an economic upswing," Handelsbanken economist Jes Asmussen was quoted by the news agency Ritzau as saying in a note to investors.
But he also cautioned that "the slow recovery in the labour market and the need for continued deleveraging" among households meant that their spending might be slower to rise than their confidence.