U.S. Consumer Spending Increased in July

by Christopher Freeburn | August 30, 2012 9:32 am

Data released by the Commerce Department on Thursday morning showed that, despite lingering doubts over the economy, consumers were more willing to go shopping last month[1].

According to the government, consumer spending rose 0.4% in July. That matched economists’ expectations, Reuters noted.

Consumer spending had beenĀ flat in June.

Adjusting for inflation, consumers spending still rose 0.4% in July. That marked the largest monthly rise since February and provided a glimmer of hope that the economy might improve during the second half of the year.

It also reversed a 0.1% dip in real consumer spending in June.

With spending up, Americans saved less in July. The savings rate slipped from 4.3% in June, to 4.2% last month.

The government noted that household income rose 0.3% in July. Adjusting for inflation, household income also increased 0.3%, topping a 0.2% gain in June.

Earlier this month, the Commerce Department announced that retail sales had risen[2] 0.8% in July, topping economists who had predicted just a 0.3% increase in sales, and reversing June’s 0.5% decline. Electronics and automobile sales rose strongly during the month, according to the government.

Endnotes:
  1. were more willing to go shopping last month: http://www.reuters.com/article/2012/08/30/us-usa-economy-spending-idUSBRE87T0MC20120830
  2. retail sales had risen: http://investorplace.com/2012/08/july-retail-sales-rise-beat-forecasts/

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