U.S. consumers became less upbeat in early March as rising gasoline costs made Americans more uneasy about the economy, the University of Michigan (search) said Friday.

The report said its measure of confidence had slipped to 92.9 so far this month from 94.1 in February, according to market sources who saw the subscription-only report.

"It sounds like there's a bit of a negative reaction to higher oil prices but the level of confidence is still more than high enough to keep consumer spending growing solidly," said Jim O'Sullivan, senior economist at UBS (search) in Stamford, Conn.

The survey's expectations component eased to 83.6 from 84.4, while sentiment on current conditions dipped to 107.3 from 109.2.

Consumer spending is the backbone of the U.S. economy, accounting for two-thirds of overall activity, so improved confidence is tracked as a precursor to stronger growth.

In recent years, however, the correlation between confidence and actual retail sales (search) has weakened, with consumers purchasing cars and homes even as they tell surveys that things are getting worse.

Because of this trend, financial markets have started paying less attention to confidence data. That was certainly the case on Friday, when reaction to the survey was subdued.