By Lucia Mutikani

WASHINGTON (Reuters) - U.S. consumer confidence fell to a five-month low month in February, with fewer consumers planning to purchase homes, automobiles and go on vacation over the next six months amid concerns about the short-term economic outlook.

The survey from the Conference Board on Tuesday also showed consumers' inflation expectations rising after moderating for two straight months. But with the labor market rapidly churning out jobs and COVID-19 cases subsiding, the second straight monthly decline in confidence and drop in buying intentions likely do not signal a major slowdown in consumer spending.

Retail sales surged in January even as confidence ebbed. Consumers accumulated more than $2 trillion in excess savings during the pandemic, which should help to underpin spending.

"Though inflation is high and a major concern for consumers, it hasn't historically restricted spending," said Robert Frick, corporate economist at Navy Federal Credit Union in Vienna, Virginia. "With the Omicron wave quickly subsiding and many states and cities lifting restrictions, we should expect spending, especially on services, to accelerate."

The Conference Board said its consumer confidence index dipped to a reading of 110.5 this month, the lowest since last September, from 111.1 in January. Economists polled by Reuters had forecast the index decreasing to 110.0.

The index remains above its pandemic lows. Unlike the University of Michigan's consumer sentiment index, which fell to a decade low in mid-February, the Conference Board survey puts more emphasis on the labor market.

The survey's measure of current conditions improved, likely because of declining coronavirus infections that were driven by the Omicron variant. Its gauge of expectations for growth in the short term fell to a five-month low, suggesting a cooling in growth in the first half of the year.

But the slowdown will probably be modest, with business activity regaining speed in February as the drag from the Omicron surge diminished.

In a separate, data firm IHS Markit said its flash U.S. Composite PMI Output Index, which tracks the manufacturing and services sectors, rebounded to a reading of 56.0 this month from 51.1 in January. It attributed the sharp rise to "employees returning from sick leave, increased traveling and greater availability of raw materials."

Stocks on Wall Street fell amid escalating Russia-Ukraine tensions. The dollar slipped against a basket of currencies. U.S. Treasury yields rose.

TIGHT LABOR MARKET

The Conference Board's so-called labor market differential, derived from data on respondents' views on whether jobs are plentiful or hard to get, fell to a still-high reading of 42.0 this month from 43.0 in January. This measure correlates to the unemployment rate from the Labor Department. There were 10.9 million jobs openings at the end of December.

Consumers' inflation expectations over the next 12 months increased to 7.0% from 6.8% last month. With inflation expectations rising, fewer consumers planned to buy cars and other big-ticket items over the next six months. Consumers were also not keen on vacations, with the share planning to go on holiday over the same period the smallest since June 2021.

Plans to buy a house also fell, likely reflecting rising mortgage rates, which combined with soaring prices are making home purchasing unaffordable, especially for first-time buyers.

Record low housing supply is driving up prices. The backlog of homes approved for construction but yet to be started is at an all-time high as builders struggle with shortages and higher prices for inputs like softwood lumber for framing, as well as cabinets, garage doors, countertops and appliances.

There is a migration from metro areas with expensive homes to areas in the Mountain West and South regions, where houses are relatively more affordable. The migration, fueled by both remote work and strong regional economies, is driving up house prices, analysts and realtors say.

A third report showed the S&P CoreLogic Case-Shiller's 20 metropolitan area home price index rose 18.6% on a year-on-year basis in December after advancing 18.3% in November.

The increase was led by Phoenix, where prices shot up 32.5% over the past year. Prices surged 29.4% in Tampa and accelerated 27.3% in Miami. Both are experiencing rapid growth in technology and financial sectors. There was also strong price appreciation in San Diego, Las Vegas, Denver and Los Angeles.

"The influx of new investment is pulling in new residents from the Northeast, many of whom have sold homes at prices well above the median in Tampa and Miami, which allows them to bid aggressively for the paucity of homes that are on the market," said Mark Vitner, a senior economist at Wells Fargo in Charlotte, North Carolina.

Strong house price inflation was reinforced by a fourth report from the Federal Housing Finance Agency showing home prices increased 17.6% in the 12 months through December after a similar gain in November. There were big gains in the Mountain, Pacific, South Atlantic, East South Central, West South Central and New England regions.

Though mortgage rates are near three-year highs, they are expected to remain low by historical standards.

"Consequently, house prices will extend their upward trend in 2022 driven by a combination of limited supply and steadily rising demand," said Brent Campbell, an economist at Moody's Analytics, in West Chester, Pennsylvania.

(Reporting by Lucia Mutikani; Editing by Aurora Ellis)