Blog 5 (US consumer spending)

US consumer spending growth slows
Date: 29 March, 2009
URL: http://news.bbc.co.uk/1/hi/business/7968252.stm

I read this article in the BBC news website, since the US market is vital and plays a big role in the worlds market especially in times of desperation as now, it's quite interesting to read how the normal American reacts to this situation and this articles suggests that The Commerce Department said that consumer spending edged up 0.2%, compared with a 1% jump in January, February marked the second month to see an increase in spending, but followed six months of declines. We can look at it in different ways; either the American consumers are getting accustomed to the situation or they believe the worst of what we've seen in the economy is over, Because recent upbeat data on the housing market and factory orders has triggered hopes that the worst might be over. Analysts said the data could be a sign that the economy is on the mend, but questioned whether the spending could be sustained. "I would not say we have seen a bottom, the economy is probably not declining as quickly as it was," said David Sloan, an economist at 4Cast. Obviously no one can tell the future but since Consumer spending forms the backbone of the US economy, accounting for 70%. So seeing the American people active and willing to spend might be a good sign for the future.