US retail sales are bouncing back

US shoppers are proving resilient

US retail sales have risen by more than expected in September, easing concerns that US growth is in danger of slowing.

Commerce Department figures showed sales up 1.5% from August and 7.7% from a year earlier, with car sales rising faster than in nearly three years.

But consumer sentiment figures soured the mood as the University of Michigan index slid to 87.5, far below forecasts and indicating possible trouble ahead.

Industrial output of 0.1% in September also fell short of expectations.

Analysts had predicted that US factories, mines and utilities would show a 0.3% rise in production.

You get a sense that consumer optimism is not what it was at the beginning of the year Bob Gay, Commerzbank Securities

The output figure - which showed falling manufacturing outweighed by a booming utilities sector - followed a 0.1% slip in August.

Elections

The numbers, released just three weeks before the US elections, give a further insight into the state of the world's largest economy as the country goes to the polls.

Incumbent president George W Bush and challenger John Kerry have put the state of the economy, and plans to drive growth, at the heart of their campaigning.

Mr Bush and Mr Kerry are neck-and-neck in the race for the White House, polls show, with voting set for 2 November.

Economic figures released in recent months have shown a mixed picture.

Soaring energy prices and the risk of further rises in interest rates have some observers worried that consumers - the engine of the US's return to growth - are losing their enthusiasm to spend.

"You get a sense that consumer optimism is not what it was at the beginning of the year," said Bob Gay, global strategist at Commerzbank Securities in New York.

"My guess is you should attribute some of (the) decline to stepped up conflicts, geopolitical events and the unsettled global view, as much as the bread and butter issues that usually affect these surveys."

And after a surge between March and May, employment statistics have tended to disappoint.

Mr Kerry, for example, seized on disappointing jobs data - showing less than 100,000 new posts in September, well short of what is needed simply to reflect workforce growth - in the recent presidential debates.

But Mr Bush's supporters say the economy has added close to a million jobs this year so far.