Dive Brief:

• Consumer spending grew .3% in July thanks to rising wages and incomes, according to the monthly retail spending report by the U.S. Commerce department. June’s increase was also revised to a .3% increase.

• Excluding restaurants and food, retail trade sales were up .6 % from June, and up 1.6% percent year over year.

• Incomes (including all forms of money going to households) increased .4% in July, and the important measure of wages and salaries increased .5%, the biggest increase this year (since November).

Dive Insight:

July’s consumer spending bump is a good indication that the U.S. economy was largely sheltered from the economic woes seen globally, so far. We will see if recent Wall Street jitters change that. 

But increasing wages and salaries are helping widen shoppers’ wallets, and lower gas prices are finally making a difference too. That’s leading to consumer optimism not seen in years, according to a recent report from Cushman & Wakefield, “The Consumer is Back to Pulling His Weight.” 

“Consumers are in a good place,” Cushman & Wakefield’s Kenneth McCarthy, told National Retail Investor magazine. “They feel like they’re in good shape, and they’re spending money. The persistence of high levels of optimism … points to continuing solid growth in consumer spending in 2015 and 2016.” 

July’s growth was moderate, and missed some estimates; economists surveyed by Bloomberg, for example, expected a .4% increase. But overall it’s a fairly rosy picture, thanks to rising wages.

“The consumer is pretty much chugging along,” Jefferies LLC economist Tom Simons, who predicted the actual growth number, told Bloomberg. “It’s clearly encouraging to see the wage gain. We definitely need more of that to see a sustained acceleration in consumption.”