Spending on cars and other big-ticket items was cut sharply for the second month in a row. The Commerce Department's report for February was actually a better showing than economists had expected. They were predicting consumers would trim spending by 0.2 percent. And, January's flat reading on spending -- based on revised figures -- also was a bit of an improvement from the government's initial estimate that consumers cut spending by a 0.1 percent during that month.
Still, the figures show that consumers, the main force keeping the economy going, don't have the hardy appetite for spending that they have previously displayed. And, they are thinking twice about making big-ticket purchases.
Americans' incomes, including wages, interest and government benefits, rose by a modest 0.3 percent in February, down from a 0.4 percent advance the month before. Although bad winter weather was a big factor dampening sales at the nation's retailers in February, economists said that consumers are turning more cautious amid the muddled economic climate.
A worsening labor market has made people worry about keeping their jobs. In February, the nation's unemployment rate rose to 5.8 percent as the economy lost 308,000 jobs. Economists believe the jobless rate will move up to 6 percent in March and higher in coming months.
And a turbulent stock market, higher energy prices and uncertainties stemming from the war with Iraq have made consumers nervous about their own financial prospects, economists said.