By Jeannine Aversa
The Associated Press

WASHINGTON - After splurging in July, America's shoppers spent more modestly in August amid higher energy prices and job losses.

Sales at the nation's retailers rose by 0.6 percent last month, following a 1.3 percent sales increase registered in July, the Commerce Department reported Friday.

Although August's sales performance was weaker than the 1.5 percent gain economists were forecasting, analysts said consumers are still spending at a healthy pace and are keeping their wallets and pocketbooks sufficiently open to help along the economy's recovery.

"Consumer spending rose solidly in August, even if it was expected to be up even more than we saw," said Joel Naroff, president of Naroff Economic Advisors.

Excluding sales of automobiles, which can swing widely from month to month, sales at all other merchants rose by 0.7 percent in August - close to economists' predictions for a 0.8 percent rise.

In a second report, higher costs for energy and food helped to boost wholesale prices 0.4 percent in August, following a 0.1 percent increase in July, the Labor Department said.

Energy prices shot up 1.2 percent last month, mostly due to a 6.3 percent jump in gasoline prices. Food prices rose 0.7 percent, compared with a 0.2 percent dip in July. Higher energy and food prices can put a strain on some households' budgets, leaving them with less money to spend on other things, economists said.

Concerns about higher gasoline prices helped dampen consumer confidence in early September, economists said. The University of Michigan's index of consumer sentiment dipped to 88.2 in September from 89.3 in August, a preliminary reading showed.

Sales at gasoline stations rose 2.7 percent in August, reflecting higher prices at the pump.

Consumers, whose spending accounts for roughly two-thirds of all economic activity in the United States, have kept the economy going since the 2001 recession. And they will play an important role in determining the strength of the anticipated rebound in the second half of this year.

Some economists believe growth in the final six months of this year will clock in at a rate in the range of 3.5 percent to 5 percent.