U.S. Consumer Spending Rises After Inflation, While Prices Drop in March

Without accounting for inflation, spending was flat

Americans’ spending is expected to pick up this spring due largely to rising incomes. Photo: Julie Jacobson/Associated Press

By Josh Mitchell

Updated May 1, 2017 5:30 p.m. ET

WASHINGTON—Americans’ spending grew steadily in March after accounting for inflation, positioning the economy to rebound from another winter slowdown.

But consumer prices fell, a sign of underlying weakness that could give the Federal Reserve pause as it considers further increases in its benchmark interest rate.

Personal consumption, a measure of what households spent on everything from groceries to dental care, rose 0.3% after inflation, the Commerce Department said Monday. That followed two months of declines.

Without accounting for inflation, spending was flat.

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