WASHINGTON (AP) – U.S. consumers spent slightly more in February following two straight monthly declines and their income rose by a healthy amount, a development that economists hope will keep boosting spending in coming months.
Consumer spending edged up a tiny 0.1 percent last month following declines of 0.2 percent in both January and December, the Commerce Department reported Monday. The result reflected a 0.4 percent increase in nondurable goods such as food and energy after three straight months of declines that stemmed from falling gasoline prices. Durable goods were down 0.1 percent as auto sales weakened.
Income grew a solid 0.4 percent in February, matching January’s rise. Economists are hopeful that continued strong income gains will lift consumer spending, which accounts for 70 percent of economic activity.
With income growing faster than spending, the saving rate jumped to 5.8 percent of after-tax income, up from 5.5 percent in January and the highest level since December 2012.
Part of the increase in saving was probably involuntary. Severe winter weather kept shoppers away from the malls and auto showrooms.