By Jeannine Aversa, AP Economics Writer
WASHINGTON (AP) — Confidence is growing that the economic recovery won't fizzle out. Consumers kept cash registers humming last month at a decent pace, pointing to modest and steady economic gains ahead.
The Commerce Department reported Monday that consumers boosted their spending by 0.3% in February, marking the fifth straight monthly gain.
Nigel Gault, chief U.S. economist at IHS Global Insight, called it "an encouraging sign of consumer revival."
The pickup in spending was a tad slower than the 0.4% increase registered in January and marked the smallest increase since September. Nonetheless, the spending gain was considered decent, especially given the snowstorms that slammed the East Coast and kept some people away from the malls.
"Households are starting to ease up on their tight grip on their wallets, though it would be nice if they had more money to spend," observed Joel Naroff, president of Naroff Economic Advisors.
Americans' incomes didn't budge.
Incomes were stagnant in February, as the bad weather forced employers to trim workers' hours. That followed a solid 0.3% gain in January and marked the weakest showing since July, when incomes actually shrank. Income growth is the fuel for future spending.February's flat-line reading suggests shoppers will be cautious in coming months.
Spending growth in February matched economists' expectations. The reading on income was a bit weaker than forecast.
Both the spending and income figures in Monday's report point to a modest economic recovery.
That cheered Wall Street investors. The Dow Jones industrial average gained 46 points to close at 10,896. The Dow hasn't traded above that level since September 2008.