U.S. consumer spending grew briskly in August and a key measure of inflation firmed a bit, signs of strength in America's domestic economy that could lead the Federal Reserve to tighten interest rates despite weakness abroad.
The Commerce Department said on Monday consumer spending increased 0.4 percent after an upwardly revised 0.4 percent rise in July.
The figures give a bullish sign for economic growth in the third quarter.
"These data underscore the ongoing health of the consumer sector," said John Hoff, an economist at RBS Securities.
The report could help convince investors of Fed Chair Janet Yellen's view, most recently expressed on Thursday, that the economy was strong enough to warrant a rate increase this year. New York Fed President William Dudley on Monday also said a hike was likely this year and could come as soon as October.
Investors have been doubtful, with many betting that the Fed's first rate increase in a decade won't come until March.