Household spending was flat last month as consumers pulled back on big-ticket goods purchases and spent more on services, in what has been an uneven recovery from the Covid-19 pandemic.
Personal income fell 2% in May from April, as the impact faded from government stimulus checks sent out earlier in the year. April spending was upwardly revised to a 0.9% increase from a previously reported 0.5% rise.
Household spending has been supported by rising vaccination rates and ample household savings from rounds of government stimulus when the pandemic restricted businesses and activities. Customers have been going out more as states and cities lift the restrictions.
Stronger demand also is driving up prices. The core personal-consumption expenditures price index, which excludes often volatile food and energy items, rose 0.5% in May from a month earlier and 3.4% from a year earlier.
Source: Dow Jones
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