US Consumer Spending Rises 0.6% in August

U.S. consumer spending rose 0.6% in August, marking the third straight monthly gain and the largest increase in five months, while inflation-adjusted spending climbed 0.4%. Personal income rose about 0.4% and wages showed more moderate gains, supporting continued outlays. The Federal Reserve’s preferred gauge showed core PCE at 2.9% year-over-year and headline PCE at 2.7%, with monthly PCE up 0.3% and core PCE up 0.2%, keeping inflation above the Fed’s 2% target. Economists say the spending strength was concentrated among higher-income households, leaving lower-income families more exposed to tariffs, higher prices and impending SNAP cuts. Policymakers and markets view the report as evidence of a steady economy but also as a reminder of upside inflation risks that will influence Fed decisions in the months ahead.