The Consumer Conundrum
Maybe consumers haven't noticed their incomes aren't growing. Or, perhaps tired of being frugal, they stepped up their spending now for a second month in a row, spending those tax refunds quickly instead of saving them. Or perhaps consumers with large stock market portfolios have felt wealthier and parted with some of their funds. Whatever the cause, we've had another month where spending outpaced expectations.
This morning's Retail Sales report showed an advance of 0.8% in March from February, following a 1.0% gain from the month before. I'm a little cautious on extrapolating a long-term trend from the past two months of quite solid increases, though, because the savings rate has been falling, as consumer spending has grown more robustly than the anemic growth of consumer incomes....276 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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