Report Shows Consumer Spending Down in May
A spending and income report shows American's spent less on "big ticket" items in May. Experts believe consumer spending will continue to be “sluggish” for months to come.
Article written by guest writer Rin Mitchell
What’s the Latest Development?
According to reports, due to low employment rates and low compensation, consumers were more financially conscious about spending in May. Industry experts say consumers will probably be more focused on where their dollars are going in the coming months as well—which means less dining out and more holding off on new automobile and home purchases. Industry analysts believe the drop in consumer spending confirms the concern that the purchases households make from now on "will provide less of a boost to the economy this quarter"—as Americans are growing "weary" of buying "so-called" big ticket items. Reportedly, restraining sales along with the debt crisis in Europe and the U.S. Fiscal policy are believed to be key factors as to why the Federal Reserve recently lowered borrowing costs.
What’s the Big Idea?
According to economic data reports, sales have weakened in the restaurant, car and housing industries. Employment rates are not rising fast enough and employee compensation isn't going up, which continues to be a “drag” on consumers. Based on data from a report, consumers were more conscious of their spending habits in May than any other month this year. Economists believe this spending mood will continue in the coming months for many Americans.
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