People walk outside a Sephora store in New York on Friday, May 7, 2021. The beauty retailer recently announced a commitment to devote at least 15% of its store shelves to Black-owned brands. (AP Photo/Robert Bumsted)
The Associated Press
WASHINGTON (AP) - Consumer spending was flat in May while incomes dropped for a second month as the impact of the government's individual impact payments waned. Inflation, however, posted a sizable gain of 0.4%.
Consumer spending was unchanged in May, a marked slowdown following gains of 0.9% in April and a 5% surge in March that had been fueled by distribution of payments of up to $1,400 per individual from a $1.9 trillion stimulus bill, the Commerce Department reported Friday.
With those payments winding down, incomes fell by 2% in May after an even bigger drop of 13.1% in April.
Inflation tied to a gauge of consumer spending that is closely watched by the Federal Reserve increased 0.4% in May and is up 3.9% over the past 12 months, well above the Fed's 2% target for annual price increases.
A customer wears a mask as she waits to get a receipt at a register in a Target store in Vernon Hills, Ill., Sunday, May 23, 2021. Retail sales fell in May, dragged down by a decline in auto sales, likely due to fewer cars being made amid a pandemic-related shortage of chips. Sales dropped a seasonal adjusted 1.3% in May from the month before, the U.S. Commerce Department said Tuesday, June 15. (AP Photo/Nam Y. Huh)
The Associated Press
FILE - This April 21, 2020 file photo shows Amazon tractor trailers line up outside the Amazon Fulfillment Center in the Staten Island borough of New York. One of the nation's largest union is aiming to unionize Amazon workers. Representatives from the International Brotherhood of Teamsters, a union that represents 1.4 million workers, voted on Thursday, June 24, 2021, to make organizing Amazon workers a priority. (AP Photo/Mark Lennihan, File)
The Associated Press