A widely watched gauge of consumer confidence in the US fell for the second consecutive month in September, adding to evidence economic growth may have slowed in recent months.
Consumer sentiment as measured by the University of Michigan fell for September to 87.7, down from 89.3 in August. The final figure for the month was also lower than the previous estimate of 88.2.
The mood of consumers is being closely watched by economists for signs of possible slowdowns in spending levels, which have been a crucial factor in the economic rebound. The current conditions and the separate expectations indices of the Michigan report also fell back in September.
There was better news on US economic growth for the second quarter.
Gross domestic product was revised higher to 3.3 per cent, according to the US Department of Commerce, contrary to Wall Street expectations that the figure would be unchanged.
Consumer spending increased at a 3.8 per cent annual rate in the second quarter with non-residential investment, generally taken as a measure of businesses' willingness to expand, growing at a 7.3 per cent pace.
"It is widely expected that GDP growth will rise by at least a 5 per cent annualised rate from the second quarter to the third," said Mr John Lonski, chief economist at Moody's Investors Service.
This surge would be supported by a buoyant housing market and by lean inventories that imply businesses have more incentive to make new investments.
The continuing involvement of US forces in Iraq may also help sustain the unusually robust defence spending.
Mr Lonski expects fourth-quarter growth in GDP to be about 3 per cent.
Much of the growth in the second quarter came from increases in personal expenditures, defence spending by the federal government and fixed investment. The rises were offset slightly by a higher revision to imports.
A separate report showed more than 1.7 million people slid into poverty in 2002, and incomes were down as well.
According to an annual report by the US Census Bureau, the number of people considered living in poverty rose to 34.6 million last year, up from 32.9 million in the prior year.- (Financial Times Service / Reuters)
