U.S. consumers boosting economy

Despite belt-tightening in Washington, slowdown in heavy industry and businesses unwillingness to increase spending, consumers are the only one who are keeping the U.S. economy on track. A steady pace of household spending is largely providing the world's largest economy a stable growth despite a slowdown in growth all around the globe. Even despite the government's tax hikes in January and a decision to introduce severe budget cuts two months later, confidence is slowly returning to consumers. It seems that constantly increasing stock prices, rising home values and a lower cost of gas are offsetting the negative drag from latest Washington measures. 

A gauge of consumer confidence is forecast to rise to 72.5 in May and touch the highest level since last fall. In the meantime, another index, consumer sentiment, has already reached a six-year high, while an updated report on sentiment will be issued on Friday. However, a rebound in consumers' mood was unexpected as the closely-watched labour market is not producing as many working places as it did a few months ago. It is also expected that personal income would increase 0.2% for the second month in a row.