Accessibility links

Breaking News

Report: A Surprising Surge in US Consumer Spending

U.S. consumer spending surged in January, far more than economists had expected.

A report from the Commerce Department Tuesday showed spending up 2.3 percent, the strongest gain in more than a year, and more than double what analysts expected.

Experts watch consumer spending closely because consumer demand drives about two-thirds of the U.S. economy, which is the world's biggest.

Analysts predict the spending surge will encourage the U.S. central bank to continue its campaign of gradually raising interest rates to fend off inflation.

We will get another picture of the U.S. economy on Wednesday when the Federal Reserve's new Chairman, Ben Bernanke, is scheduled to deliver a report to Congress.

Some information for this report was provided by AFP, AP and Reuters.