Consumer spending continued to accelerate in August, even as the drags from surging utility and childcare costs partially offset a boost in sentiment from falling gasoline prices, according to research released by Bank of America Corp.'s Bank of America Institute. The research showed that total payments in August increased 13% from a year ago, up from 7% growth in July, as data shows that customer saving and checking account balances continue to remain elevated, relative to pre-pandemic levels. Meanwhile, the average utility payment rose 16%, and could continue to rise in September as increased spending due to recent heat waves may not yet be reflected in utility bills. The dollar value of childcare payments grew 9.7%, due to higher prices of about 3% and a roughly 7% increase in inflation-adjusted spending. "Economic data suggests that parents - especially women between 25-54 - are returning to the labor market, and the number of Bank of America customers making childcare payments was almost at pre-pandemic levels in August, at around 94% of the level seen in January 2020," the research said. Separately, back-to-school spending during the peak of the period -- July 15 to Aug. 30 -- was down about 4%.
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