After a program boosting auto sales ran out, U.S. consumer spending fell for the first time in five months in September. Personal consumption expenditures decreased $47.2 billion or 0.5% last month, as expected by most economists, following a revised 1.4% jump in August, the Commerce Department said.
The fall in spending came as Americans' income turned flat in September following a 0.1% increase the previous month, the department said.
Consumer spending surged 3.4% after a 0.9% drop in the second quarter, a rise the department said "largely reflected" auto purchases under the cash-for-clunkers program in July and August.
After four negative quarters, the world's largest economy grew at a seasonally adjusted 3.5% annual rate in the July-September period from the second quarter, the Commerce Department said. The increase was the first since the second quarter of 2008 and the biggest expansion since the 2007 third quarter.
The third-quarter rebound was led by consumer spending, which accounts for two-thirds of U.S. economic activity and added 2.36 percentage points to GDP growth. Other leading drivers were business inventories and home building.
After shrinking a sharp 6.4% in the first quarter, the economy has been supported via the federal $787 billion emergency stimulus and other crisis measures.
Copyright Agence France-Presse, 2009
