Consumer Spending is Back: 3-Year High in QI

One highlight of today's BEA report on GDP is that real personal consumption expenditures increased 3.6% in the first quarter, which is the largest quarterly growth in consumer spending since the 3.7% growth in the first quarter of 2007 (see chart above). It's also the first time since 2007 of three consecutive quarters of positive growth in consumer spending, and is above the 3.05% average growth rate since 1980.

This rebound in consumer spending starting in the third quarter of 2009 provides further evidence that the recession ended last July, and we are now ten months into an economic expansion that is gaining strength and momentum with almost every new economic report.