US consumer spending posts strongest gain in 4 months, while incomes flat

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FILE - In this April 1, 2015 file photo, a pedestrian passes the entrance of a hat store in the Harvard Square neighborhood of Cambridge, Mass. The Commerce Department releases its March report on consumer spending, which accounts for 70 percent of economic activity, on Thursday, April 30, 2015. (AP Photo/Steven Senne, File)

WASHINGTON – U.S. consumers boosted spending in March by the largest amount in four months, a hopeful sign that this key sector of the economy is reviving after a frigid winter.

The Commerce Department says consumer spending increased 0.4 per cent in March, the strongest gain since a similar increase in November. Spending fell in December and January before climbing a modest 0.2 per cent in February.

The rise in spending came despite the fact that income growth was flat in March, the poorest showing in more than a year and a reflection of the fact that job gains slowed sharply in the month.

The latest result is an encouraging sign that consumer spending, which accounts for 70 per cent of economic activity, could help boost an economy that barely grew in the first quarter.

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