US economy: US consumer finally getting smarter - spending flat despite rising income

US consumer spending was surprisingly flat despite rising income in April as Americans remain cautious amid high unemployment, government data showed Friday. Consumer spending barely rose after six consecutive monthly gains while personal income climbed 0.4 percent for the second consecutive month in April, the Commerce Department said.

Spending rose by less than 0.1 percent. Most economists had expected consumer spending to rise 0.3 percent in April from a revised 0.6 percent March and incomes to gain 0.4 percent from an identical rise the prior month.

Americans however increased their savings. The Commerce department said the US savings rate rose 3.6 percent compared with 3.1 percent rise in March. Consumer spending is a key cog for US growth.

For more - AFP: US consumer spending flat despite rising income