US consumer spending was unchanged in February as incomes posted a solid advance, the government said today in a report that defied forecasts for a spending drop.
Consumer spending was flat both last month and in January, the US commerce department said. The department previously had said spending slid 0.1 per cent in January.
The department also said personal income rose 0.3 per cent in February after an upwardly revised 0.4 per cent gain a month earlier, suggesting fuel for possible future spending. After-tax income rose 0.2 per cent last month.
Wall Street economists had expected spending to fall 0.1 per cent in February as severe winter weather kept shoppers at home and had forecast a milder 0.2 per cent rise in income.
Although spending held up better than expected, the report suggested rising energy costs were suppressing spending elsewhere in the economy. Consumer spending when adjusted for inflation dropped 0.4 per cent, the largest fall since last September.