Archive for Thursday, March 14, 2002

Consumer spending inches up in February

March 14, 2002


— Consumers spent more freely in February and provided a modest boost for the nation's retailers.

Though the 0.3 percent rise in sales reported by the Commerce Department Wednesday wasn't as big as many economists had anticipated, the advance still was the largest in four months. And, the increase came after shoppers sharply cut back spending on cars in January, contributing to a 0.3 percent drop in overall retail sales that month.

The fact that consumers didn't close their pocketbooks and wallets in February and instead spent solidly  though not lavishly  on big-ticket items, including cars, furniture and appliances, was considered encouraging.

"Households continue to make the major purchases that would normally falter if demand was not holding up," said economist Joel Naroff of Naroff Economic Advisors.

Economists predicted consumers would continue to spend  albeit modestly  and help the recovery. A less volatile stock market, an improved jobs market and tax refunds now arriving in mailboxes bode well for more buying ahead, they said.

"Consumers will lead the economy into recovery into the spring and summer months," said an optimistic Stuart Hoffman, chief economist with PNC Financial Services Group.

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