US consumer spending cooled in April under pressure from higher food and energy prices and as Americans saw little change in buying power, the Commerce Department said today.
Consumer spending rose 0.4% in April, slowing a little from March's 0.5% gain, while personal income also rose 0.4%, the department said.
The slowdown in April spending suggested the American consumer, whose buying drives a major share of growth in the economy, continues to be cautious in the face of rising food and fuel prices and high unemployment that rose to 9% in April.
Disposable income increased 0.3%, but adjusted for inflation, real disposable income edged down less than 0.1% in April.
The department's consumer price index showed food and fuel prices were still driving up the prices consumers pay, but those costs appeared to be showing up in other areas, too.
The consumer price index rose 0.3% in April, a bit softer than the 0.4% rise in March. Excluding food and energy, the index rose 0.2%, double the previous month's increase.
On a 12-month basis, inflation heated up to 2.2%, from 1.8% in March, according to the index which serves as a reference for the Federal Reserve. The April inflation reading topped the Fed's 2% rate seen as the top end of its comfort zone for price stability.
