US Consumer Spending Beats Expectations in August, Inflation Rises

US Consumer Spending Beats Expectations in August, Inflation Rises
US Consumer Spending Beats Expectations in August, Inflation Rises

US consumer spending rose more than expected in August, but a downward revision to July data kept expectations that economic growth slowed in the third quarter as a new surge in COVID-19 infections hampered demand for services.

The US Commerce Department said today that consumer spending, which accounts for more than two-thirds of US economic activity, rose 0.8 percent in August, ignoring a drop in auto sales caused by a global shortage of semiconductors, which is slashing auto production.

July data was revised down to show that consumer spending fell 0.1 percent instead of rising 0.3 percent as previously reported.
The spending likely received a boost from shopping for the return of schools to work and tax credit payments for children, according to “Reuters”.

On the other hand, inflation maintained its upward trend in August. The PCE price index, which excludes food and energy, rose 0.3 percent after rising by the same margin in July.
In the 12 months to August, the so-called core PCE price index rose 3.6 percent, similar to the increase recorded in July.

Source

Consumer Spending Beats Expectations August Inflation Rises

 
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