Fact Check: "Americans cut spending for the first time since January, dropping 0.1%."
What We Know
Recent data from the U.S. Bureau of Economic Analysis indicates that personal consumption expenditures (PCE) decreased by $29.3 billion, or 0.1%, in May 2025. This marks the first decline in consumer spending since January of the same year (Personal Income and Outlays, May 2025). Additionally, a report from the Associated Press confirms that overall spending fell by 0.1% in May, coinciding with a 0.4% drop in personal income (Gloomy Americans cut back on spending as inflation ticks ...). This decline in spending is attributed to various factors, including a significant drop in spending on goods, particularly automobiles, as consumers rushed to make purchases earlier in the year to avoid impending tariffs (US consumer spending falls; tariff-related boost to inflation ...).
Analysis
The claim that Americans cut spending for the first time since January, with a reported drop of 0.1%, is substantiated by multiple reliable sources. The U.S. Bureau of Economic Analysis is a credible government source that provides comprehensive economic data, including personal income and consumption statistics. Their report clearly states the 0.1% decrease in PCE, which aligns with the claim.
Moreover, the Associated Press and Reuters, both reputable news organizations, corroborate this information. They highlight the context of the spending decline, noting that it is influenced by external factors such as inflation and changes in consumer behavior due to tariffs. The reports indicate that while spending on goods decreased, there was a slight increase in spending on services, suggesting a nuanced view of consumer behavior (Gloomy Americans cut back on spending as inflation ticks ..., US consumer spending falls; tariff-related boost to inflation ...).
The analysis of these sources reveals that while the overall spending has decreased, the economic landscape is complex, with various factors at play. The decline in spending is not solely a result of consumer choice but also reflects broader economic conditions, including inflation and adjustments in income.
Conclusion
Verdict: True
The claim that Americans cut spending for the first time since January, dropping 0.1%, is accurate based on reliable data from the U.S. Bureau of Economic Analysis and corroborated by multiple reputable news sources. The evidence supports the assertion that consumer spending has indeed declined, marking a significant shift in economic behavior.
