Retail sales dipped, wholesale prices climbed, and industrial output inched higher in October, while consumer moods brightened in November, reports showed on Friday.

But much of the data was skewed by an easing in vehicle sales incentives - and sales and production were stronger and prices better contained when automobile-related figures were excluded.

"We've past the lift-off phase and we're starting to move into sustainable orbit," said David Resler, chief economist at Nomura Securities.

The US economy surged at a 7.2% annual rate in the third- quarter and most economists expect it to settle into a more reasonable growth rate of around 4% in the current quarter, largely because of a slowdown in consumer spending.

The mixed data triggered caution on Wall Street, where stock prices ended the day lower. The blue-chip Dow Jones industrial average closed down 69 points, or 0.7%, while the technology-laden Nasdaq Composite Index fell nearly 2%.

The US dollar was also spooked, tumbling to a three-week low against the euro.

Lifting consumer spirits

Recent signs of a quickening pace of economic growth and job gains appears to have lifted consumer spirits. The University of Michigan's preliminary index of consumer sentiment for November released on Friday hit 93.5, its highest level since May 2002, market sources said. This was well above October's final reading of 89.6.

Good news for Bush: Better job
figures may be aiding confidence

The survey's current conditions index rose to 102.8 from 99.9 and the expectations index, which tracks perceptions about the economy over the next 12 months, jumped to 87.6 from 83.0.

"The November results are significant because they show a breakout on the upside. At 93.5 we have moved into optimistic territory," said Richard DeKaser, chief economist at National City Corp in Cleveland, Ohio.

Analysts said improving employment prospects likely played a role in boosting confidence. US employers added 286,000 workers to their payrolls in August through October, the best three-month performance since before the economy entered recession in 2001.