Pluses, minuses in latest economic reports

Retail sales across the nation climbed more than forecast in September, easing concern that unemployment stuck near a 26-year high will bring the economic recovery to a halt.

Sales rose 0.6 percent, which followed a 0.7 percent gain in August, the Commerce Department said Friday. Other reports Friday showed that inflation cooled last month, and manufacturing in the New York region accelerated.

While those were positive signs, an unexpected decline in consumer sentiment was a reminder that a jobless rate forecast to exceed 9 percent through next year will curb the consumer spending that accounts for 70 percent of the economy.

Meanwhile, Federal Reserve Chairman Ben S. Bernanke, in a speech in Boston on Friday, said the recovery may need additional monetary stimulus because inflation is too low and too many Americans are still out of work.

The "reports are all consistent with Bernanke's message," said John Herrmann, senior fixed-income strategist at State Street Global Markets L.L.C. in Boston. "The consumer and the economy are still in need of support, as private job creation is insufficient to cause a material improvement in the unemployment rate and in consumer confidence."

Here are more details on Friday's economic reports:

Retail sales. Americans spent more on cars, furniture, and at hardware stores to boost retail sales to a third monthly increase in September.

Sales were projected to rise 0.4 percent, according to the median estimate of 80 economists in a Bloomberg News survey.

Auto sales, which had fallen 0.5 percent in August, rose 1.6 percent in September, the best showing since March.

Inflation. Consumer prices rose 0.1 percent in September, less than forecast, figures from the Labor Department showed.

Core prices, which exclude food and fuel costs, were unchanged from August, meaning that core inflation over the last 12 months was just 0.8 percent - the smallest year-over-year increase in prices since 1961.

The weak economy is keeping a lid on prices. High unemployment and stagnant wages make it hard for retailers to pass on any price increases.

Manufacturing. A report from the Federal Reserve Bank of New York showed manufacturing in the region accelerated. Its general economic index rose to 15.7 in October, the highest in four months.

Consumer confidence. The Thomson Reuters/University of Michigan preliminary index of consumer sentiment decreased to 67.9, the lowest since July, from 68.2 in September. Economists had forecast an October reading of 68.9, according to the median estimate in a Bloomberg survey.