Crisis Damps US Consumer Recovery in September

   

U.S. consumer confidence rose to a seven-month high in September but not as much as previously thought as worries over the growing financial crisis clouded the outlook, a survey showed on Friday.

AP

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The Reuters/University of Michigan Surveys of Consumers said the final reading of its index of confidence rose to 70.3 in September from 63.0 in August. It was the highest final reading since 70.8 in February.

However, it was below economists' expectations for a reading of 71.0, according to the median of their forecasts in a Reuters poll. It was also down from 73.1 recorded in the Surveys' of Consumers' preliminary report released on Sept 12.

"The rebound in consumer confidence ended amid heightened concerns about the growing financial crisis, although these concerns arose too late in the month to completely erase the earlier gains," the report said.

Financial markets are in the grips of a year-long credit crisis caused by the worst U.S. housing slump since the Great Depression, which has also slowed the broader economy.

The credit turmoil has worsened in recent days, and pressure mounted on lawmakers on Friday to agree on a $700 billion financial rescue plan after talks at the White House broke down in acrimony and the biggest bank closure in U.S. history roiled global markets.

However, helping consumers' outlook, worries over inflation moderated this month, but also not as much as previously thought