U.S. consumer spending rose at a sluggish pace in July, even while Americans got some relief on prices, indicating the economy is feeling the pinch from the highest inflation in a generation.
Purchases of goods and services, adjusted for changes in prices, increased 0.2% after being flat a month earlier, Commerce Department data showed Friday. Spending on both merchandise and services advanced. The median estimate in a Bloomberg survey of economists was for a 0.4% advance.
The personal consumption expenditures price index, which the Federal Reserve uses for its inflation target, fell 0.1% from a month earlier, the first negative print since the start of the pandemic. That in part reflected a notable drop in energy prices, while food costs continued to rise.
