American households cut spending by 1% last month as cold weather hit much of the country, but they are poised to resume shopping as the pandemic slows and a new round of stimulus lands on the bills. banking.
The drop followed a stimulus-induced spending explosion in January, when spending grew 3.4%, more than previously estimated. Household incomes fell 7.1% last month, the Commerce Department said, after government stimulus money caused incomes to rise 10.1% in January.
Consumers slashed spending on goods last month, while increasing spending on services.
The overall decrease in income and expenses last month is likely temporary.
Cold weather, including storms that closed sections of Texas and other states, prevented many people from dining out, ordering food online or going to stores last month. Household incomes also fell from abnormally high levels in January, when the government distributed stimulus checks of up to $ 600 per person to most households under a $ 900 billion financial aid plan approved by Congress late. from last year. That law also provided improved job benefits of $ 300 per week for unemployed workers.