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Gallup: Consumer Spending Hits 9-Year High

Image: Gallup: Consumer Spending Hits 9-Year High
AP/Julie Jacobson

By    |   Monday, 07 Aug 2017 09:54 AM

Americans' daily self-reports of spending averaged $109 in July, the sixth month in a row in which spending has averaged $100 or more.

This is the highest spending average in Gallup's trend since May 2008.

The July average is based on more than 14,000 interviews conducted as part of Gallup Daily tracking throughout the month, Gallup reported.

Economists monitor consumer spending closely because it accounts for about 70 percent of U.S. economic activity.

Gallup asks Americans each night to report how much they spent the previous day, excluding spending on normal household bills and major purchases such as a home or car. The measure gives an indication of discretionary spending.

With six consecutive months of average daily spending at or above $100, Americans' spending levels are back to where they were before the global financial crisis in 2008, and the latest figure is the second-highest average in nearly a decade of Gallup's tracking. The elevated spending levels are stable among both higher- and lower-earning Americans.

This is a strong start for the second half of 2017, but given August's propensity for flat or lower spending, Americans' relatively high spending average in July is not likely to hold.

Spending among both higher- and lower-earning Americans was slightly up in July and is among the highest in Gallup's recent trend. Higher earners' spending has consistently been more than double that of lower earners.

Adults in households whose annual income is $90,000 or more reported a spending average of $178 throughout July. Meanwhile, spending among Americans in households earning less than $90,000 annually averaged $80.

The Commerce Department recently said consumer spending, which accounts for more than two-thirds of U.S. economic activity, edged up 0.1 percent in June after a 0.2 percent gain in May. There was also little sign of inflation.

The personal consumption expenditures (PCE) price index, excluding food and energy, increased 1.5 percent in the 12 months through June, after advancing by the same margin in May, Reuters reported.

The so-called core PCE is the Federal Reserve's preferred inflation measure. The U.S. central bank has a 2 percent target.

When adjusted for inflation, consumer spending was unchanged in June after rising 0.2 percent in May. June's flat reading points to moderate consumer spending growth in the third quarter. The data was included in last Friday's GDP report.

Since accelerating at a 3.8 percent pace in the second quarter of 2016, consumer spending growth has remained below a 3.0 percent rate, restrained by sluggish income gains.

In June, personal income was unchanged. That was the weakest reading since a 0.1 percent dip in November 2016 and followed a 0.3 percent increase in May. Wages and salaries rose 0.4 percent in June.

Personal dividend income declined 3.0 percent after surging 4.8 percent in May on a boost from Apple Inc. Income at the disposal of households after accounting for inflation fell 0.1 percent, the largest decrease since last December.

(Newsmax wire services contributed to this report).

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Americans' daily self-reports of spending averaged $109 in July, the sixth month in a row in which spending has averaged $100 or more. This is the highest spending average in Gallup's trend since May 2008.
gallup, consumer, spending, americans
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2017-54-07
Monday, 07 Aug 2017 09:54 AM
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