DATE=9/29/03

TYPE=CORRESPONDENT REPORT

TITLE=U-S ECON (S)

NUMBER=2-308031

BYLINE=MICHAEL BOWMAN

DATELINE=WASHINGTON

VOICED AT:

INTRO: New figures from the Commerce Department show that Americans accomplished a rare feat in August: simultaneously spending and saving more money than they had the month before. V-O-A's Michael Bowman reports from Washington.

TEXT: The Commerce Department reports U-S consumer spending rose by a robust point-eight-percent in August, led by purchases of so-called "durable" goods such as cars and appliances. Yet the national personal savings rate edged higher by point-two-percent, to three-point-eight-percent of after-tax income.

How can Americans spend and save more at the same time? The answer is simple: in August, Americans had more money to do both, according to the Commerce Department's Jane Callen.

/// CALLEN ACT ///

Personal income grew point-two-percent. Disposable personal income grew point-nine-percent. There was a decrease in personal tax and non-tax payments of 51-billion (dollars) in August, which led to the rise in disposable personal income.

/// END ACT ///

In other words, earnings rose modestly, but lower federal-tax witholdings left Americans with significantly more disposable income or "take home" pay, some of which was spent and some of which was saved.

Consumer spending accounts for more than two-thirds of economic activity in the United States. Analysts say the extent to which Americans continue to open their wallets will have a major impact on the strength of a U-S economic recovery. (SIGNED)

NEB/MCB/KL/RAE