President Barack Obama is getting a bump in his approval ratings from an improving economy but Americans want him to focus on reducing debt and spending, a Reuters/Ipsos poll showed on Wednesday.

The poll found reasons for optimism for Obama as he searches for areas of compromise with newly emboldened Republicans this year and lays the groundwork for his 2012 re-election bid.

Obama's job approval rating went up to 50 percent from 45 percent in December, the first time Obama has achieved 50 percent approval in this poll since last June.

Still, many Americans still do not approve of his job performance -- 47 percent disapproved of him in this poll, compared to 46 percent in December.

With the economy showing signs of picking up its pace of growth, more Americans are likely to say the country is on the right track -- 36 percent in January, up from 29 percent in December. But 59 percent of Americans still said the country is on the wrong track.

As the economy gets better, so does the administration, said Ipsos pollster Cliff Young. Looking to 2011, he's going to have more credibility among voters. It suggests that pushing his agenda, while difficult, is not going to be impossible.

Obama had a good month in December as Congress approved key bills he supported, like an extension of Bush-era tax cuts, the START nuclear treaty with Russia and an end to a ban on gays serving openly in the military.

The survey was conducted January 7-10 and did not cover the unfolding events in Tucson, Arizona, where U.S. Representative Gabrielle Giffords was shot in the head and six people were killed in a gunman's rampage on Saturday.

Independent voters who abandoned Democrats in November 2 elections and who Obama will need to win a second term in 2012 are willing to take a second look. In this poll, independents backed him 50 percent to 45 percent.

Most of the gains came from his fellow Democrats, 77 percent of whom approved of him, evidence that he is bolstering his position within his core constituency.

DEBT LIMIT

There was plenty in the poll to buoy the hopes of Republicans in their drive to cut the $1.3 trillion U.S. budget deficit and overall debt of $14 trillion.

The United States may reach its legal limit on borrowing by March 31, potentially creating a crisis scenario unless Congress acts to raise the debt limit.

But the poll found 71 percent of Americans oppose raising the debt ceiling. Many Americans are willing to cut spending in areas including the defense budget and foreign aid.

People are saying, 'Listen, enough is enough,' Young said. But as in all budgetary debates, the devil is in the details. Americans said hands-off some of their sacred cow programs.

The poll found only 20 percent interested in cutting Social Security and 23 percent in favor of Medicare cuts. While 51 percent are willing to examine cutting the defense budget, only 18 percent would reduce veterans' benefits.

Americans expect a more long-lasting solution to the issue of the debt. Merely raising the limit is not sufficient. There are going to have to be a lot of other things with it, like spending cuts, said Young.

Obama is expected to delve into the debt reduction issue in his State of the Union speech to Congress on January 25.

A debt commission established by Obama offered a plan last month to overhaul the U.S. tax code by eliminating or narrowing many tax breaks and cutting the deficit by nearly $4 trillion over the next decade. It received a cool reception from many on Capitol Hill.

Of the 1,021 people surveyed, 780 were registered voters, including 451 Democrats, 388 Republicans and 182 independents.

It had a margin of error of 3.1 percentage points for all those surveyed, 3.5 points for registered voters, 4.4 points for Democrats, 4.9 points for Republicans and 7.4 points for independents.

Interviews were conducted of people on both landlines and cell phones.

(Editing by Todd Eastham)

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