Consumer Spending, Income Climb in January

Consumer spending and personal income increased in January, the Commerce Department said.

Spending rose 0.4%, following a 0.1% increase in December that had been revised downward, Commerce said March 3. Consumer spending accounts for about 70% of the economy.

Personal incomes rose 0.3%. Economists surveyed by Bloomberg News predicted a 0.1% increase in spending on average.

The report from Commerce matches other recent reports indicating that consumers are regaining confidence despite a harsh winter that continues, Bloomberg reported.

“Consumer spending had OK momentum” in January, Brian Jones, senior U.S. economist at Societe Generale, told Bloomberg. “We expect to see better job growth in the spring. More people with jobs means more money to spend.”