Consumers were spending on big-ticket items last month as personal income moved higher. Kelsey Hubbard reports.
American's saw a little more cash in their wallets last month. And they weren't afraid to spend it on big ticket items like cars and appliances. Personal income climbed 0.4 percent for fourth consecutive months. While U.S. consumer spending also picked up gaining 0.3 percent in July. Consumer spending makes up more than two-thirds of U.S. economic activity. The economy maintained some of its strength from the second quarter, when it expanded at a 3.7 percent annual rate. Chris Rupkey from Bank of Tokyo-Mitsubishi says: "The consumer certainly has the wherewithal to go out and spend it, because, increasingly they are making it, with their disposable incomes that's after tax dollars soaring the last four months." The upbeat data will play into whether the Federal Reserve will hike interest rates this year. Fed officials have said they will raise interest rates - pinned at near zero since 2008 - as early as next month, if economic data show the economy is gaining strength.