Posted By: Janine Delacroix

Thu Nov 9, 11:06 AM ET

NEW YORK (Reuters) - U.S. consumer sentiment weakened
slightly in early November, a report showed on Thursday, as
consumers scaled back their view of their current and future
financial conditions.
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The declines in the latest survey's readings were small but
just enough to cast worries on how consumers would spend during
the holiday shopping season.

"This is in-line with what we are looking at with the
retailers and it confirms the weakness on the retail side,"
said Paul Nolte, director of investments at Hinsdale Associates
in Hinsdale, Illinois.

The University of Michigan's preliminary reading on
consumer sentiment in November was 92.3, down from October's
reading of 93.6, said sources who saw the subscription-only
report.

The median forecast of Wall Street economists polled by
Reuters was for a reading of 93.6.

Falling gasoline prices have brightened consumer mood but
not enough to elevate them again in early November, economists
said.

Retail gasoline prices averaged $2.23 a gallon last week,
3.5 cents lower than a week earlier and 50 cents below a year
ago, the Energy Information Administration said earlier this
week.

The University of Michigan survey's index of current
conditions slipped to 106.5 in early November from 107.3 in
October, while consumer expectations dipped to 83.2 from 84.8
in October.

Consumer spending accounts for about two-thirds of U.S.
economic activity, but in recent years confidence measures have
been a weak guide to actual spending.

Consumers' expectations for increased inflation fell in
early November the report said, according to the sources.

The University of Michigan's preliminary November reading
on one-year U.S. inflation expectations was 3.0 percent, down
from 3.1 percent in October.

Median expectations for inflation over a five-year horizon
fell to 3.0 percent from 3.1 percent in October.

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