Consumer Spending Weak in February

03/28/2008

WASHINGTON (AP) - Consumers, jolted by a credit crisis, job cuts and soaring energy costs, turned in the weakest spending performance in 17 months in February. It was fresh evidence that the risks of a recession are increasing.

The Commerce Department said Friday that consumer spending edged up by just one-tenth of 1 percent last month, the poorest showing since September 2006. And if the effects of inflation are removed, spending was flat in February, the third consecutive month of sluggish activity.

The performance of the consumer is closely watched since consumer spending accounts for two-thirds of total economic activity. Economists said the sustained weakness in this area is one of the most worrisome signs that the economy could be tipping into a recession.