Consumer Spending Drop Biggest Since 9/11
Tue Aug 3,11:49 AM ET
By Tim Ahmann
WASHINGTON (Reuters) - U.S. consumer spending in June took its biggest
plunge since September 2001 as shoppers, sapped by high energy costs,
cut back sharply on car purchases, a government report showed on
Tuesday.
Personal spending dropped 0.7 percent in June after climbing 1 percent
in May, according to Commerce Department (news - web sites) data. Wall
Street had braced for a mild 0.1 percent drop.
Adjusted for inflation, spending tumbled 0.9 percent.
By both measures, it was the biggest drop in consumer spending since
September 2001, when shoppers retrenched in the wake of the attacks on
New York and Washington.
U.S. stock markets opened lower, prices for U.S. government bonds got
a lift and the dollar slipped after the report, which was seen as
bolstering the case for the Federal Reserve (news - web sites) to move
cautiously as it raises interest rates from multi-decade lows.
"The second quarter was a kind of disappointment and a lot of that has
to do higher energy prices. That zapped some of the demand from the
economy," said George Mokrzan, chief economist at Huntington Financial
Group in Columbus, Ohio.
http://story.news.yahoo.com/news?tmpl=story&cid=580&ncid=580&e=1&u=/nm/20040803/bs_nm/economy_dc
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It's gonna take two Johns to flush all the crap out of the White
House....
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John Kerry...bringing complete sentences back to the White House
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