Business

US consumer spending rebounded in May

Shoppers walk down Broadway in Manhattan, New York
Image caption The consumer spending figures helped lift Wall Street

US consumer spending rebounded in May, rising by 0.3% and reversing a 0.3% fall in April, official figures show.

Other data published on Thursday also suggested that the US economy remains on a growth path.

The number of new claimants for unemployment benefits fell last week, while contracts to buy previously-owned homes were at a six-year high in May.

The data helped lift Wall Street, with the Dow Jones up 1% and S&P and Nasdaq indexes up about 0.8%.

Analysts said the figures were not spectacular, but at least showed that the economy was heading in the right direction.

The Labor Department said initial claims for unemployment benefits last week fell 9,000 to a seasonally adjusted 346,000. The four-week moving average for new claims, which irons out week-to-week volatility, fell 2,750 to 345,750.

"Economic growth is not over the top, that's for sure," said Chris Rupkey chief financial economist at the Bank of Tokyo-Mitsubishi. But he added: "We expect, however, economic growth will be strong enough to bring unemployment down at an acceptable pace."