U.S. Consumer Spending Rises 0.1 Percent in February

U.S. consumer spending rises 0.1 percent in February

WASHINGTON, March 31 (Xinhua) — U.S. consumer spending rose by 0.1 percent in February after a surge of 0.8 percent in the previous month, while personal incomes climbed by the smallest amount in three months, the Commerce Department reported Friday.

Data showed that the tiny rise in consumer spending reflected a 1.9 percent drop in purchases of durable goods, items expected to last at least three years, such as automobiles and computers.

Spending on non-durable goods such as food also fell by 0.6 percent in February, while spending on services rose by 0.9 percent.

In February, personal incomes increased by 0.3 percent, compared to the 0.7 percent jump in January. Disposable incomes, the amount left after paying taxes, grew by 0.2 percent following a gain of 0.6 percent in January.

The nation’s personal savings rate, was unchanged at a negative 0.5 percent in February.

A negative personal savings rate meant that Americans not only spent all of their after-tax income but also dipped into previous savings or increase borrowing.

Consumer spending has been closely watched since it accounted for two-thirds of total economic activity.