Consumer spending rose 0.3 percent in February from the previous month, increasing for a fifth consecutive month, a Bureau of Economic Analysis (BEA) report showed.
Personal income was flat for February but rose in the four previous months. This latest BEA report shows that consumer spending continues to recover.
Last week, Best Buy (NYSE:BBY) reported revenue growth of 12 percent year-on-year and comparable store revenue growth of 7 percent.
The same-store retail sales report for February also showed strong results, particularly for apparel retailers.
Same-store stores sales grew 11 percent for Ross (NASDAQ:ROST) and 10.3 percent for Nordstrom (NYSE:JWN).
Not all stores showed spectacular results; same-store sales declined 3.2 percent at Rite Aid (NYSE:RAD) and modestly grew 2.4 percent for Target (NYSE:TGT).
The industry overall is showing broad signs of recovery.
An important factor that constrains spending is the weak job market. Although it has stabilized, the U.S. economy is still struggling to add new jobs.
To gauge the health of consumer spending and the overall economy, investors will closely watch Wednesday's ADP non-farm private payrolls, Thursday's unemployment claims, and Friday's payrolls report released by the Bureau of Labor Statistics.