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Confident consumers boost spending 0.6% in July

WASHINGTON — U.S. consumer spending grew 0.6 percent in July, a healthy gain.

The Commerce Department said Friday that personal incomes rose 0.1 percent, the smallest gain in 10 months.

With spending ahead of incomes, the savings rate fell to 7.7 percent, the lowest since last November, but still a solid figure by historical standards.

With trade fights discouraging business investment and cutting into exports, consumers are increasingly important to the U.S. economy.

“The U.S. consumer continues to display great vitality, emboldened by solid income growth and a large savings buffer,” said Lydia Boussour, senior U.S. economist at Oxford Economics.

Consumer confidence was high in August, according to the Conference Board, a business research group, and Americans’ assessment of the current state of the economy was the most positive it has been in nearly 19 years.

Fifteen percent tariffs on about $150 billion of consumer goods imported from China were scheduled to take effect as of Sept. 1. Duties will be imposed on another $150 billion Dec. 1.

An inflation measure in the report increased 0.2 percent in July and 1.4 from a year earlier, evidence that inflation remains mild.

Excluding food and energy, core prices rose 0.2 percent in July and 1.6 percent from a year ago.

Incomes grew at an anemic pace in July, following a string of healthy gains that have helped Americans’ ability to spend.

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