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Marketplace

Consumer spending surged in April. Why?

Mark Garrison May 31, 2016
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A Toys'R'Us store in Miami, Florida, 2010. 
Joe Raedle/Getty Images

Economists, companies and politicians spend a lot of time trying to figure out what’s going on in the brains of American consumers: what they want, how they feel and most of all, how they’re spending. Tuesday morning brought brand new hard data. Consumer spending surged in April by the largest amount in more than six years. The 1 percent gain was as big as it was in large part because of hefty spending on durable goods, such as cars and appliances.

There’s a commonly accepted storyline that goes something like this: big-picture economic indicators like jobs and GDP may be hopeful, but many Americans still don’t personally feel great about the economy. Today’s numbers could be an early sign that Americans are feeling better about their prospects, enough to buy some big-ticket items. Or not. The data only give a snapshot of one month’s worth of spending, which could have been high only because people held back on spending during previous months. One month doesn’t make a trend, so it’s far too soon to be confident that the recent shopping spree will endure.

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