Consumer spending in the U.S. doubled in May, the Commerce Department reported this morning, attributing most of the rise to billions of dollars in government stimulus packages mailed last month.
Personal consumption expenditures rose 0.8% in May, compared to an upwardly revised 0.4% increase in April, marking the largest monthly gain since September 2005. Economists, on average, were predicting a 0.7% rise. Adjusting for the 0.4% rise in consumer prices, real spending rose 0.4%, marking the largest jump in 9 months.
Meanwhile, personal income jumped 1.9% higher in May, more than 4 times the 0.4% gain the Street had predicted. Real disposable incomes (post-tax and adjusted for inflation) increased 5.3% in May. Minus rebates and inflation, real disposable incomes were flat.
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