Page 7 - aruba today sept 29,2015
P. 7
U.S. NEWS A7
Tuesday 29 September 2015
US Financial Front:
American consumer spending up 0.4 percent in August
MARTIN CRUTSINGER overall economic growth People shop the cosmetics section of the CityTarget store in Boston. U.S. consumer spending rose
AP Economics Writer for the spring, saying the at a healthy rate in August, while income growth slowed after a big jump in July, the Commerce
WASHINGTON (AP) — U.S. gross domestic product ex- Department said Monday, Sept. 28, 2015.
consumer spending rose panded at an annual rate
at a healthy rate in Au- of 3.9 percent in the April- (AP Photo/Michael Dwyer)
gust, while income growth June quarter.
slowed after a big jump in That’s a strong rebound
July. from an anemic rate of 0.6
Consumer spending ad- percent in the January-
vanced 0.4 percent com- March period. Much of
pared to July, when spend- that bounce back reflects
ing also increased by 0.4 a surge in consumer spend-
percent, the Commerce ing, which grew at a 3.6
Department said Monday. percent rate in the spring,
In both months, the fig- double the rate in the win-
ures reflected strong gains ter.
in purchases of durable Economists believe that
goods such as autos. overall growth has slowed
Consumer spending ac- to something around 2.2
counts for two-thirds of percent to 2.5 percent in
economic activity, and the the current quarter. Yet
latest result supports ex- they expect a modest ac-
pectations for it to remain celeration in the final three
strong in the second half of months of this year, be-
this year. That should help lieving that strong gains in
serve as a buffer against a employment will provide
global slowdown that has people with more money
hurt American manufactur- to spend.
ers. The slowdown in income
“Overall consumer spend- growth in August meant
ing remains robust and that that the saving rate
highlights a solid employ- slipped a bit to 4.6 percent
ment backdrop,” said Brick- of after-tax incomes, down
lin Dwyer, an economist at from 4.7 percent in July.
BNP Paribas. “We expect An inflation gauge pre-
firm spending ahead as ferred by the Federal Re-
employment remains solid serve was unchanged in
and wages begin to accel- August, while core inflation
erate.” excluding food and energy
Sal Guatieri, senior econo- showed a tiny 0.1 percent
mist at BMO Capital Mar- increase. Over the past 12
kets, said that the spend- months, prices have risen
ing gains were broad, with just 0.3 percent, and core
consumers getting a boost inflation is up 1.3 percent.
in spending power from Both inflation measures are
falling energy prices. He far below the Fed’s target
predicted that spending for annual price increases
in the current July-Septem- of 2 percent.
ber quarter would remain Fed officials passed up a
robust at an annual rate chance at their September
above 3 percent. meeting to begin raising in-
Personal income was up 0.3 terest rates from the record
percent in August, helped low near zero, where they
by another solid increase have been for nearly sev-
in wages and salaries. The en years. They noted that
result follows a 0.5 percent they wanted to wait given
income gain in July, which recent adverse develop-
had been the best showing ments that have roiled the
in eight months. global economy and finan-
The government on Friday cial markets.q
issued its final estimate for
