- Consumer spending increases 0.9% in April
- Inflation adjusted consumer spending rises 0.7%
- Core PCE price index gains 0.3%; up 4.9% year-on-year
- Goods trade deficit narrows 15.9% to $105.9 bln in April
WASHINGTON, May 27 (Reuters) – (This 27th May story corrects paragraph 14 to say “consumer prices” (not inflation), adds dropped word “since”)
U.S. consumer spending rose more than expected in April as households boosted purchases of goods and services, and the increase in inflation slowed, which could underpin economic growth in the second quarter amid rising fears of a recession.
The economy’s near-term prospects were also brightened by other data from the Commerce Department on Friday showing the goods trade deficit narrowed sharply last month. A record trade deficit caused a contraction in output in the first quarter.
“The economy can always turn on a dime, but at this point in the economic cycle, consumers are still spending their hearts out, keeping the recessionary winds at bay,” said Christopher Rupkey, chief economist at FWDBONDS in New York.
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