ECON: Jobs optimism lifts consumer sentiment in May
NEW YORK, May 27 (Reuters) – U.S. consumer sentiment improved in May as job gains offset high gasoline prices, while inflation expectations diminished, a survey released on Friday showed.
Consumers were also more upbeat about the longer term outlook for the economy, the Thomson Reuters/University of Michigan survey showed. Even so, income expectations remained at low levels.
The final reading on the overall index on consumer sentiment was 74.3, up from 69.8 the month before and higher than the preliminary reading of 72.4.
Economists polled by Reuters had expected the index to be unchanged from the preliminary figure.
“Sagging real incomes have made consumers more cautious spenders, with rising gas prices especially troublesome for younger and lower income households,” Richard Curtin, director of the survey, said in a statement.
“The data continue to indicate the maintenance of a moderate pace of consumer spending during the balance of 2011.”
The survey’s gauge of consumer expectations jumped to 69.5 from April’s 61.6. It also came in above a predicted reading of 67.5.
The survey’s barometer of current economic conditions was 81.9, slipping from April’s 82.5 but topping forecasts of 80.2.
The survey’s one-year inflation expectation fell to 4.1 percent from 4.6 percent, its first decline since September 2010. The survey’s five-to-10-year inflation outlook held steady at 2.9 percent.
(Reporting by Leah Schnurr)
U.S. consumer spending tepid in April – RTRS
WASHINGTON, May 27 (Reuters) – U.S. consumer spending rose less than expected in April as high gasoline prices continued to squeeze household budgets, according to government data on Friday which also showed annual inflation accelerating at its fastest pace in a year .
The Commerce Department said consumer spending increased 0.4 percent, rising for a 10th straight month, after a downwardly revised 0.5 percent gain in March.
Economists polled by Reuters had expected spending, which accounts for about 70 percent of U.S. economic activity, to rise 0.5 percent last month after a previously reported 0.6 percent rise in March.
When adjusted for inflation, spending nudged up 0.1 percent last month after gaining 0.1 percent in March.
The report suggested consumer spending maintained its weaker tone into the second quarter as high gasoline and food prices continue to stretch household finances.
Consumer spending rose at a 2.2 percent rate in the first quarter, braking sharply from a 4 percent pace in the October-December period.
But a recent cooling in gasoline prices should ease some of the pressure on households and boost spending in the months ahead.
High food and energy prices in April kept inflation pressures simmering, with the personal consumption expenditures price (PCE) index rising 0.3 percent after advancing 0.4 percent in March.
Compared to April last year, the index was up 2.2 percent, the biggest rise in a year, after increasing 1.8 percent in March.
The core PCE index — excluding food and energy – increased 0.2 percent after rising 0.1 percent in March.
(Reporting by Lucia Mutikani, Editing by Andrea Ricci)
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