Thursday October 1, 03:31 PM
US consumer spending driven by 'clunkers' program
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WASHINGTON (AFP) - US household spending jumped 1.3 percent in August, driven by auto sales helped by the "cash for clunkers" incentives, government data showed Thursday.
The rise in spending came as incomes rose 0.2 percent in the month, according to data from the Commerce Department.
The pickup in spending reflected the "clunkers" program that offered government incentives to trade in old vehicles for newer, more fuel-efficient models.
Sales of durable goods, which include cars and appliances, rose a hefty 5.8 percent in the month.
Purchases of motor vehicles and parts "accounted for most of the August increase in purchases of durable goods," the Commerce Department said.
Analysts had expected a 1.1 percent gain in personal spending and a 0.1 percent rise in incomes.
Personal saving as a percentage of disposable personal income was 3.0 percent in August, compared with 4.0 percent in July. It marked a third straight drop, suggesting consumers are slowly beginning to spend more after a recession-inspired retrenchment.
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