Economy 1stLd-Writethru 03-02
Consumer spending rises, but …
WASHINGTON — Consumer spending rose in January after falling for a record six straight months, pushed higher by purchases of food and other nondurable items. But the increase is expected to be fleeting given all the problems facing the economy.
The Commerce Department said today that consumer spending rose 0.6 percent in January, even better than the 0.4 percent gain that economists expected.
Personal incomes rose 0.4 percent in January, partly reflecting the cost-of-living adjustments provided to millions of Social Security recipients. Still, that was better than the 0.2 percent decline economists expected.
The personal savings rate surged to 5 percent, the highest level since 1995 as consumers continued to sock away more of their incomes amid the deepening recession.