Consumer spending in the U.S. grew in May as Americans used gains in income to shore up household finances.
Purchases, which account for about 70% of the economy, climbed 0.2% after being little changed in April, Commerce Department figures showed. Incomes advanced 0.4%, and the saving rate increased to an eight-month high.
Projections for spending ranged from gains of 0.1% to 0.6%. The previous month’s reading was initially reported as a drop of 0.1%.
And with consumer confidence rising in June, the trend should continue. Consumer confidence index increased to 82.5 from 81.9 in May. The median projection in a Bloomberg News survey of economists called for a reading of 81.2.
Expectations for the year were little changed as most households said wages probably will rise less than inflation, leading to lower living standards, Bloomberg reported.
