The White House said yesterday it saw worrying signs in the US economy, including a drop in a widely watched consumer confidence index. But it believed US economic fundamentals were solid.

Private research group The Conference Board said its index of consumer attitudes fell nine points to 97.1 in July from 106.3 in June. That was its biggest fall since October, the lowest level since February and far below analysts' expectations of a drop to 101.9.

White House spokesman Mr Ari Fleischer said the drop may partly reflect the recent US stock market's declines and he stressed President Bush's view that other indicators - including economic growth, low unemployment and low inflation - suggested the economy was on a solid footing.

"You've seen a variety of economic statistics and data come out, most of it good, some of it not good," Mr Fleischer said.

"There are plenty of signs to look to in the economy to see the strength that the president sees. But there is no question that there are some worrisome signs like consumer confidence," the spokesman added.

He said Mr Bush wanted Congress to enact legislation that may strengthen the economy.

Mr Fleischer did not identify these Bills, but Mr Bush earlier yesterday called on Congress to make permanent the tax cuts it enacted in 2001, to enact legislation to help protect worker pensions and to restrain government spending.

"The fundamentals of our economy are sound. After all, sales of automobiles and new houses are on the rise, new unemployment claims have been falling since April, inflation is low, productivity is increasing and growth continues," Mr Bush said as he signed into law legislation to fight company fraud.

"These are signs of strength in our economy and, with the right policies, we can build on them," Mr Bush added.

- (Reuters)