By Thomson Reuters – Re-Blogged From Newsmax
U.S. consumer spending barely rose in August likely as Hurricane Harvey weighed on auto sales and annual inflation increased at its slowest pace since late 2015, pointing to a moderation in economic growth in the third quarter.
The weak report from the Commerce Department on Friday did little to change expectations that the Federal Reserve would raise interest rates in December. Chair Janet Yellen said on Tuesday the Fed needed to continue gradual rate hikes despite uncertainty about the path of inflation.
“We think current economic conditions are heavily impacted by the effect of the recent hurricanes,” said Chris Rupkey, chief economist at MUFG in New York. “The Fed will rightly look over any soft patch for economic growth in the third quarter.”