US households cut spending by 1% last month as cold weather hit much of the country, but are poised to resume shopping as the pandemic eases and a new round of money boosts landing in bank accounts.
The decline followed an stimulus-induced explosion in January, when spending rose 3.4%, more strongly than previously estimated. Household incomes fell 7.1% last month, the Commerce Department said, after government stimulus money boosted incomes by 10.1% in January.
Consumers drastically reduced spending on goods last month, while spending on services rose.
The overall decline in last month’s revenue and expenditure is likely to be temporary.
The cold weather – including storms that closed sections of Texas and other states – prevented many people from eating, ordering food online or going to stores last month. Household incomes also fell from abnormally high levels in January, when the government distributed incentive controls of up to $ 600 per person to most households under a $ 900 billion economic aid plan approved by Congress at the end. last year. This law also provided for increased employment benefits of $ 300 per week for unemployed workers.