The closely watched Consumer Confidence Index fell in March to its lowest level in five months, but analysts said that doesn’t signal a major shift in consumer demand.

March’s overall index slipped to 136.7 from its revised February level of 140.8, according to the Conference Board, which compiles the index. The decline marked the second straight month that the index — at a record high of 144.7 in January — posted lower numbers. The slip also was larger than expected: Wall Street analysts had looked for a dip to 139.8. The overall index was dragged down by consumers’ six-month outlook. That subindex sank to 106.2 from 114.6. Analysts cited worries about the job market. Also, consumers told the board that prospects for rising incomes are a bit gloomier.

February’s slump in new nonfarm jobs may have influenced that subindex. February payrolls added only 43,000 new jobs, compared to 384,000 in January.

In contrast to the outlook subindex, the present situation subindex rose. It edged higher to a 182.4 reading from 180.1.

The message? Consumers expect the economy to slow, but for now they continue to be bullish despite three key areas of pressure: higher interest rates, higher oil prices and stock market volatility.

“This (fall in the overall March index) doesn’t suggest a change in the fundamentals of the economy,” said Oscar Gonzalez, an economist with John Hancock Financial Services in Boston. “In general, the fundamental drivers are still very strong: very low unemployment, strong income growth, tremendous resilience in the stock market, still pretty buoyant home sales.”

A lower reading in the index should have been expected, said Douglas Lee, president of Economics from Washington, a consulting firm in Potomac, Md. “I wasn’t surprised,” Lee said. “After all, the University of Michigan consumer sentiment numbers in the middle of the month were soft. “I would’t read too much into these numbers,” Lee added. “We’re still looking at high levels of consumer confidence. We can get month-to-month wiggles in the levels, but that doesn’t really indicate any change in behavior, which is what we’re trying to understand. Consumer spending behavior has been extremely strong.”

And it’s likely to stay strong, which will help keep growth chugging along. “We saw very strong consumer spending levels in January and February, and as far as we can tell it’ll be a strong March,” Lee said. “All the indications are that the first quarter’s growth rate will be another strong growth rate, around 5.5%. The personal consumption expenditure number in the first quarter will probably be about that strong as well.”

More strong numbers surely mean higher interest rates, analysts said. The index for March, though down, did nothing to alter the outlook for monetary policy. And the Federal Open Market Committee, the Fed’s policy-making group, next meets May 16.

“Chances are quite high we’ll get another quarter-point rate hike at the May FOMC meeting. Then it’s not so clear after May,” Lee said. Mark Vitner, an economist with First Union Corp. in Charlotte, N.C., noted that Fed policy-makers probably were a bit disappointed that the March index didn’t post a bigger drop.

“The folks at the Fed are probably looking at these numbers and are a bit amazed, in that higher interest rates and higher oil prices haven’t caused a bigger decline,” Vitner said.

The Fed still needs to bump rates higher, but perhaps only once more in the near term, Vitner added. “We think the Fed will move one more time, in May,” he said. “Then, shortly thereafter, we think the economy will cool off enough that the Fed won’t have to raise rates again this year.

Some analysts think the Fed has more work to do on raising rates. Nothing in the board’s report shows enough of an economic slowdown to make the Fed happy, they say. The March index’s slip was “modest,” and suggests that consumers are far from daunted by Fed actions to date, warns David Greenlaw, an economist with Morgan Stanley Dean Witter. That may suggest the Fed may have to impose more than just one more rate hike in the near term to cool consumer spending, which drives two-thirds of economic activity.

Why? Think “wealth effect,” that glow investors with stock market gains feel and act on in shops, malls, retail Web sites, car dealerships and open houses.

Despite its recent volatility, the stock market is keeping consumer confidence at high levels, Greenlaw said.

“Mortgage rates are off their highs, and there really hasn’t been that much of an increase in private market rates. So I’d be hard pressed to attribute this decline (in the March index) to anything the Fed has done to this point,” Greenlaw said. “The Fed is probably going to have to do a lot more on the interest rate front to offset the stimulus that’s still in the pipeline that’s coming from the stock market.”