WASHINGTON (AP) — American consumers modestly stepped up their spending in September, but their incomes grew fast enough to let them save more, too.
The Commerce Department says consumer spending rose 0.2% last month, matching August’s increase. Incomes grew 0.3% lifting the U.S. savings rate to 8.3% in September, highest since March.
A measure of inflation closely watched by the Federal Reserve was flat in September, even excluding volatile food and energy prices. Over the past year, it is up 1.3%, and 1.7% without food and energy.
Consumer spending accounts for about 70% of U.S. economic activity. The government reported Wednesday that consumer spending rose at a solid annual pace of 2.9% from July through September, a bright spot in a quarter when the overall economy grew at a mediocre 1.9% pace.