Inflation's up, spending's down

Inflation rose 1.8 percent in May over the previous year, the largest jump since October 2012 and closing in on the Federal Reserve's goal of 2 percent, according to Bloomberg Businessweek.
 
Consumer spending fell for a second consecutive month, with the biggest hits in spending falling on clothing, eating out and going to the movies. Increasing costs for gasoline and groceries, along with wages that are still stagnant despite an improving labor market, are reasons for the spending cutbacks, the report states.
 
Analysts report job and wage insecurities are causing consumers to save rather than spend, and that it could be years before wage increases catch up to higher costs of living.

Read more from Bloomberg Businessweek.