Consumers boosted their spending in September at the fastest pace in three months, while their incomes grew by a modest amount, The Associated Press reports.
Consumer spending increased 0.5%, a significant rebound from August when spending fell 0.1%, the Commerce Department says. The increase was led by a 1.3% surge in spending on autos and other durable goods.
Incomes also increased 0.3% in September, slightly faster than the 0.2% gain in August.
The overall economy grew at a 2.9% rate in the July-September quarter, more than double the 1.4% increase in the second quarter.
That acceleration in activity came even though growth in consumer spending slowed after a burst in the spring. But the latest figure indicates that the quarter ended on a positive note, with solid spending momentum heading into the end of the year.
Jennifer Lee, senior economist at BMO Capital Markets, says the report depicted a “good handoff” from the third quarter going into the fourth quarter.
“More money coming in helped support stronger spending,” Lee said, noting that the rise in incomes marked the seventh consecutive increase.
