US consumer sentiment improved slightly in October as Americans shrugged off gloom over mounting job layoffs after the September 11th attacks, but economists warned that sentiment remained fragile.
While today's University of Michigan survey showed an improvement in overall consumer attitudes during October, confidence hovered only slightly above its lowest level in nearly eight years struck in September.
The university's closely watched sentiment barometer rose to 82.7 in October from 81.8 last month, matching analysts' forecasts. But sentiment deteriorated in the last two weeks from the mid-month reading of 83.4, in line with weekly surveys and showing there was a risk consumer optimism could again erode should bioterrorism spread.
Rising confidence is a harbinger of improved consumer spending, which underpins about two-thirds of US economic activity, although economists warned it is difficult to use as a tool to accurately forecast future consumption.
The University of Michigan consumer sentiment survey is based on roughly 500 telephone interviews with Americans across the country. The mid-month reading captures roughly 250 of that month-end total.