Retail sales did better than expected in May, posting the largest increase in six months according the Department of Commerce.
Sales jumped by 1 percent - double what many economists were expecting.
"Recession? What recession?" asked Joel Naroff, chief economist at Naroff Economic Advisors. "Spending in April and May was solid in just about every category."
The spike comes as economic stimulus payments helped offset skyrocketing gas and food prices.
"Yes, we bought a lot more gasoline as prices skyrocketed. More importantly, you name the good, electronics, appliances, clothing, health care, food or general merchandise and sales rose. We even ate out more. That is impressive, to say the least," Naroff said.
The news should come as music to the ears of the Bush administration. Congressional leaders passed the stimulus checks to boost a lagging economy plagued by - among other things - a housing slump, credit crisis and increased unemployment.
Economist Ian Shepherdson suggested that consumers' returning to their old, carefree spending habits was one reason for the increase.
While he conceded that such behavior could be attributed to the stimulus payments - he said the checks were only a temporary boost to a spending increase that would not last. The result: a weaker economic performance in the months coming.
Source: AFP, The Associated Press