If you feel like you’re spending more money than normal, you probably are. According to Reuters and business analysts, the average U.S. consumer spending has increased by 0.4% for the month of June, continuing a steady growth trend that matched May’s increase in consumer spending. The Commerce Department has data that suggests this upward trend will continue throughout the end of the year at the least, making for a strong economic third quarter.
Consumer spending accounts for almost two-thirds of all U.S. economic activity and as personal income increases, the average citizen is more likely to spend money on restaurants, luxuries, and other accommodations. Another reason for this increase in spending could be due to the rise of inflation, which was reported to be at a moderate pace at the end of quarter 2. Additionally, tax return income saw a slight increase and additional tax cuts allowed the average U.S. consumer to take home more money to spend on “wants” rather than “needs.”
Overall, there has been a 4.1% increase in GDP and Bloomberg Global Business reports as a good thing for consumers. More employers are starting to cover benefits for their employees as well, so that extra cash can go back into the economy on regular spending. Overall, in conjunction with the dollar index reaching new heights and the housing bubble likely to pop soon, 2018 could be a great financial year going into the second half of the year.