Americans increased their spending just 0.2 percent in February, while their incomes were boosted by increased wages and business owners’ income.
The Commerce Department says the modest spending increase followed an equal gain in January and a rise of 0.4 percent in December. Incomes increased a healthy 0.4 percent.
A closely watched signpost, consumer spending accounts for about 70 percent of U.S. economic activity.
After-tax income jumped 0.4 percent. With consumers holding back on spending, the savings rate rose to 3.4 percent — the highest since last August. The rate was 3.2 percent in January. Savings had fallen to a 12-year low in December.