Washington, D.C. -- A report released Monday by the Commerce Department showed that consumer spending unexpectedly stalled during the month of May, as prices climbed and 9.1% unemployment caused shoppers to cut back.
Commerce Department figures showed that purchases were flat in May, after a median estimate of economists surveyed by Bloomberg News called for a 0.1% gain. Prices excluding food and energy rose more than forecast.
“The quarter is going to be very slow,” Christopher Low, chief economist at FTN Financial in New York, told Bloomberg. “The biggest explanation for that is gas prices, so obviously the fact that oil has fallen quite a bit in the last couple of weeks is a really good thing. Relief just in time.”
Unemployment rose to 9.1%, the highest this year, as previously reported by the Labor Department.