Deloitte Consumer Spending Index Continues Upward in February

The Index, comprising four components — tax burden, initial unemployment claims, real wages and real home prices — increased to 1.53 percent, from an upwardly revised gain of 1.27 percent a month ago.

Highlights of the Index include:

Tax Burden: The tax burden continues to fall with the weakening of the economy. Tax reduction that goes into effect in April will add to a further reduction in tax burden going forward.

Initial Unemployment Claims: Claims rose again in the most recent month and are up 72 percent from a year ago.

Real Wages: Real wage growth continues to post strong growth. Real wages are up 4.6 percent from a year ago and on an annualized basis are up 13.5 percent over the last six months as energy prices have given a big boost to consumer purchasing power.

Real Home Prices: Home prices continue to fall. Renewed efforts to forestall foreclosures coupled with a tax credit for home buyers may bring some stability to this market. The decline in home prices has made home buying much more affordable. What is lacking is mortgage financing.

SOURCE Deloitte LLP

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