Tags: Consumer | spending | rose | April

Gallup: Consumer Spending Rose 6 Percent in April

By    |   Wednesday, 06 May 2015 07:00 AM

While much of the recent economic data have been weak, here's one encouraging sign.

Americans say they spent $91 on average in April, up 6 percent from $86 in March and up 3 percent from $88 in April 2014, according to a Gallup poll. To be sure, the figure was higher in several months of 2014.

But it's the strongest reading for April since Gallup began compiling the data in 2008. And it's the largest month-to-month rise since November 2014.

The economy grew only 0.2 percent in the first quarter. And experts are divided over where it's headed from here. The Atlanta Federal Reserve's forecasting model puts growth at only 0.8 percent in the second quarter.

Spending historically increases in the spring, particularly in May, "perhaps because the warmer weather encourages Americans to spend more time outside and to travel," the survey states

While "Americans were generally more negative about the economy in April," the strong spending data for March and April "may provide evidence that the flat GDP the government reported for the first quarter of 2015 was more of a temporary, weather-related situation than a sign of trouble for the economy," the study says.

Stephen Moore, a distinguished visiting fellow at the Heritage Foundation, is more downbeat about the economy. The paltry first-quarter growth offers one more piece of evidence as to the desultory state of the economy under President Obama, he says.

"Are the alarm bells finally clanging at the White House and in Congress? They should be," he writes in The Washington Times. The recovery from the 2007-09 recession is the slowest in 50 years, Moore says.

"This is a national crisis, not any less significant than the burning of Baltimore last week. . . .  We are $1.6 trillion lower on current GDP than we should be."

But all is not lost, Moore maintains "Fortunately, there are natural tailwinds that should accelerate growth over the next year or so."

That includes low energy prices and the strong dollar, which is attracting "record amounts of new investment and construction" to our shores, he says.

Oil prices have dropped 45 percent since last June, and the dollar hit multi-year highs against a range of currencies in recent months.

"But there's no getting back that nearly $2 trillion of GDP that is now permanently missing," Moore writes.

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While much of the recent economic data have been weak, here's one encouraging sign.
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Wednesday, 06 May 2015 07:00 AM
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