Commerce Dept.: Consumer Spending Flat, Prices Up 3.5% in December
February 1st, 2008
The U.S. Department of Commerce reported an increase in consumer spending of just 0.2 percent in December — flat when adjusted for inflation. Consumer prices in December, by contrast, were 3.5 percent higher than a year ago, well above the Fed’s designated “comfort zone” of 1 to 2 percent. Opinions vary on just how bad the news is, with some worrying about the possibility of stagflation and more optimistic observers predicting a period of “painfully slow” growth in consumer spending. The New York Times (Feb. 1, 2008)
Tags: consumer spending, economy, inflation, stagflation