New figures from the US suggest consumers increased their spending last month even though measures of confidence slumped.
Latest government statistics show that household expenditure – which accounts for around 70% of total GDP – rose 0.4% in March to $7.526 trillion (€6.865tn; £4,732tn), following a revised 0.1% increase in February. Incomes were also up, rising 0.4%.
March also saw a rise in purchases of durable goods (those designed to last over three years), which climbed 1.6% – the first rise for three months. Spending on services fell for the first time in seven months, dipping 0.1%.
● There was less positive news from Germany, however, as growth forecasts for Europe’s largest economy were cut in the wake of a business sentiment report.
The closely watched index of western German confidence from the Ifo economic institute slipped to 86.6 in April, down from 88.1 the month before.
The news, which bucked analysts’ expectations of a rise, prompted the government to cut full-year 2003 growth predictions from 1% to a meagre 0.75%.
Data sourced from: multiple sources; additional content by WARC staff