Make us your home page
Instagram

Consumers spending flat in June, while savings rate keeps growing

Consumers are saving more and being picky about how they spend their money, new data show.

Personal spending was unchanged in June, the Commerce Department reported Tuesday.

It was the third straight month of lackluster consumer demand. Incomes were also flat, the weakest showing in nine months. And the personal savings rate rose to 6.4 percent of after-tax incomes in June. The savings rate is now about three times the 2.1 percent average for all of 2007, before the recession began.

The disappointing report on spending and income was among a raft of reports released Tuesday that confirmed the economy ended the April-to-June quarter on a weak note.

Factory orders dropped 1.2 percent in June to a seasonally adjusted $406.4 billion, the Commerce Department said. It was the second consecutive decline after nine straight months of gains. Lower demand for steel, construction machinery and aircraft dragged down the figure.

And the number of buyers who signed contracts to purchase homes fell in June. The National Association of Realtors says its seasonally adjusted index of sales agreements for previously occupied homes dipped 2.6 percent to a reading of 75.7. That was the lowest on records dating to 2001 and down nearly 19 percent from the same month a year earlier.

Last week the government said economic growth for the second quarter slowed to 2.4 percent. Many analysts believe it will dip further in the second half of the year as high unemployment, shaky consumer confidence and renewed troubles in housing weigh on the year-old economic recovery.

Economists are worried that the financial troubles weighing on households could cause spending to ebb even more in the second half of the year. If spending is further restrained, businesses will stay cautious about hiring.

The weak economy is keeping a lid on inflation. A price gauge tied to consumer spending dropped by 0.1 percent in June. Prices are up just 1.4 percent over the past 12 months, well within the Federal Reserve's comfort zone for inflation.

Consumers spending flat in June, while savings rate keeps growing 08/03/10 [Last modified: Tuesday, August 3, 2010 8:30pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times

    

Join the discussion: Click to view comments, add yours

Loading...
  1. New stores coming to Tyrone Square Mall, like Bath & Body Works

    Retail

    Tyrone Square Mall will welcome a half dozen new stores, like Bath & Body Works and MidiCi's The Neapolitan Pizza Company, this summer.

  2. Target Corp. reaches $18.5 million settlement with 47 states over data breach

    Retail

    Target Corp. has agreed to pay Florida $928,963 out of a newly-announced $18.5 million settlement over a huge data breach that occurred in late 2013.

    Forty-seven states and the District of Columbia have reached an $18.5 million settlement with Target Corp. to resolve the states' probe into the discounter's massive pre-Christmas data breach in 2013. 
[Associated Press]
  3. Gov. Rick Scott's family history of alcohol abuse could decide 'liquor wall' bill

    Legislature

    TALLAHASSEE — Gov. Rick Scott must decide Wednesday whether to let Walmart and other big-box stores sell liquor, and he says a factor in his decision is the history of alcohol abuse in his family.

    Florida Governor Rick Scott is considering a veto of a bill that would allow Walmart, Target and other big box retail stores to sell liquor. [Andres Leiva | Tampa Bay Times]
  4. Tampa lands Super Bowl in 2021

    Bucs

    TAMPA — Record rainfall in Los Angeles ultimately may end Tampa Bay's drought of hosting the Super Bowl.

    Mike Tomlin celebrates with LaMarr Woodley and Troy Polamalu after the Steelers beat the Cardinals in 


Super Bowl XLIII  on February 1, 2009 at Raymond James Stadium in Tampa. [Times files (2009)
  5. As St. Petersburg's Jabil Circuit broadens its business, it shrinks its name to Jabil

    Corporate

    St. Petersburg's Fortune 500 company, Jabil Circuit, informally tossed aside the "Circuit" in its name some time ago. That's because circuit board manufacturing, the company's core business for decades, has been squeezed out by a broader business agenda ranging from consumer packaging to supply chain management.

    Jabil Circuit informally dropped "Circuit" from its marketing material and signage, like at its St. Petersburg headquarters, years ago. Now it's official.
[Times file photo]