Household Spending Rose in June, Before Delta Variant Upswing


U.S. households boosted spending by 1% in June as consumers shelled out more on services at the start of the summer, but a current upswing in Covid-19 cases related to the Delta variant is injecting uncertainty into the economic outlook.

Personal-consumption expenditures—a measure of household spending on goods and services—increased last month, the Commerce Department reported Friday, beating economists’ expectations for a 0.7% rise. That followed a downwardly revised 0.1% drop in May, when consumers pulled back on purchases of goods but boosted spending on services.

Friday’s report also showed Americans’ personal income rose 0.1% in June. Still, rising inflation and the latest surge in virus cases could affect future spending trends.

Inflation has accelerated this year as the economy faces supply-chain bottlenecks and materials shortages. Friday’s report showed that the core personal-consumption…

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