US consumer spending rises 0.5 per cent: Were the US' job woes just a blip?

 
Emma Haslett
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Consumer spending rose 0.5 per cent in August (Source: Getty)

Over the past few weeks, economic data coming out of the US has been less than encouraging, but new personal spending figures suggest those disappointments were little more than a blip.

Figures from the US Commerce Department released today showed personal spending rose 0.5 per cent in August, having fallen 0.1 per cent in July, while personal income rose 0.3 per cent, compared with a 0.2 per cent fall in July.

The spending figure was ahead of expectations - economists had thought it would rise 0.4 per cent.

It's good news for US investors, who had been thrown by disappointing unemployment figures published at the beginning of this month. The number of benefits claimants rose to 315,000 in mid-September, suggesting earlier figures showing job growth had fallen were more serious than realised.

But the figures could still be a cause for concern. During a speech in June, Fed chair Janet Yellen said that without "somewhat more rapid" growth in wages, "I would worry about downside risk to consumer spending".

All eyes on next month's jobs figures, then, to see whether the recovery's momentum will continue to increase.

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