ROME, Jan 28 (Reuters) - Italian consumer morale fell to its lowest level on record in January, underscoring the grim public mood ahead of a national election next month as Italians feel the pain of a long recession that shows no sign of easing.

National statistics bureau ISTAT's headline consumer confidence index fell to 84.6 in January from 85.7 the month before.

The data was below all forecasts in a Reuters survey of 15 analysts. The average forecast pointed to a pick up in the index to 86.0.

All the main components of ISTAT's survey weakened in January as consumers took a grimmer view of the economic picture and their own personal finances, both now and in the future.

The euro zone's third largest economy has been in recession since the middle of 2011 and most analysts expect gross domestic product to fall around 1 percent this year, following a contraction of around 2 percent in 2012.

Tax hikes introduced by Mario Monti's technocrat government as part of tough austerity measures have helped calm investor fears about the sustainability of Italy's huge public debt but have eroded purchasing power and deepened the recession.

The sub-indexes on current personal finances and overall future prospects both hit all-time lows, suggesting Monti's frequent assurances that an economic recovery is in sight are cutting no ice with most ordinary Italians.

Monti is running at the election at the head of a centrist coalition but he is lagging both the centre-left and the centre-right blocs in opinion polls.

Analysts say ISTAT's consumer confidence index shows little immediate correlation with spending patterns, though it does reflect longer term trends.

Consumer spending has long been an achilles heel of the Italian economy, which has been the most sluggish in the euro zone for at least a decade.

Retail sales in November -- the most recent data available -were down an unadjusted 3.1 percent from the year earlier, indicating a much more marked contraction in real or inflation-adjusted terms, and posted a fifth consecutive monthly decline.

(Reporting by Gavin Jones)) (gavin.jones@thomsonreuters.com + 39 06 8522 4232)

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