Despite the prospect of higher interest rates, firm oil prices and the euro's current strength, confidence in the European economy was the strongest in six years in May, a European Commission survey found.

"We are optimistic that Europe will be able to sustain its recent economic revival," the head of the European Commission's economic department, Klaus Regling, told a conference in Brussels.

Backing up his optimism, the European Commission's economic sentiment indicator rose faster than expected, reaching its highest point since January 2001, due mainly to consumers' upbeat attitude.

The Commission's eurozone economic sentiment indicator increased in May to 111.9 points in the 13 countries using the euro from 111.0 in April, beating economists' forecasts for a steady 111.0 points.

The outlook also improved in the broader 27-member European Union, where the indicator was up to 114.9 points in May from 113.6 in April, the EU's executive arm said.

"Rising consumer confidence was the main driving force behind the improved" outlook, the Commission said. "It in turn was supported by improved services confidence in the EU and retail trade confidence in the euro area."

The survey highlighted a strong improvement in economic confidence in the biggest EU economies, particularly in Britain, followed by France and Germany.

It also showed that overall confidence in Europe was not dampened by broad expectations for the European Central Bank to lift its key interest rates in June.

However, a separate eurozone business climate indicator from the European Commission fell in May to 1.53 points from 1.61 in April, although it remained at a high level.

But while managers surveyed expected lower orders and a weaker production trend, expectations for export orders improved in May despite the euro's strength, which makes eurozone products more expensive on international markets.

"Even if business activity retreated slightly the overall economic picture was brightened by stronger consumer sentiment, which confirms the gradual shift towards consumer spending as the main pillar of growth in the eurozone," said Bank of America economist Gilles Moec.

The European Commission is currently forecasting that economic growth in the eurozone countries will reach 2.6 percent this year, outpacing both the United States and Japan.

But Regling said there was even an "upside risk" that growth would turn out stronger than expected by the Commission. "There is a risk that we underestimated growth in Europe," he said.

Economists said that the soaring economic confidence would only comfort the European Central Bank as it keeps raising interest rates in hope of keeping inflation in check.

"We expect the bank to continue to focus on the strength of confidence and activity and therefore to raise interest rates both next week and again in the following months, probably September," said economist Jonathan Loynes with consultancy Capital Economics.