Consumer spending in July rose at its fastest pace in nearly half a year, another sign that the U.S. economy isn´t headed into a double-dip recession. Spending rose 0.8 percent on a strong demand for cars.
Spending was aided by the fading of Japan-related supply constraints. Adjusted for inflation, spending saw its highest gain in a year and a half and the first increase since April. Consumer spending is 70 percent of the U.S. economy.
Still, stock prices plunged and consumers remain steadfastly negative in their views of the economy. In other data, after-tax incomes fell and factory output in Texas nearly stalled.