While continuing to reduce their savings, U.S. consumers spent more in March than in the previous month, the sixth consecutive increase in a crucial signal that economic recovery is moving forward.
The Commerce Department reported today that spending rose 0.6 percent after increasing by an upwardly revised 0.5 percent in February, which previously came in at 0.3 percent.
Consumer spending was a driving force in the first quarter’s GDP (gross domestic product) growth of 3.2 percent, released Friday by Commerce. For the quarter, Americans forked over cash or credit cards enough to push spending up by 3.6 percent, the biggest jump since early 2007.
Personal savings for March was at $304 billion, a drop of 2.7 percent, the lowest level since September 2008.
Personal income increased $36.0 billion, or 0.3 percent, and disposable personal income increased $32.3 billion, or 0.3 percent, in March.
The 0.6 percent rise in consumer spending – which accounts for more than half of economic activity, was in line with analysts’ expectations.
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