A Banana Republic in New York. Economists said consumer spending in the United States was increasing even with higher taxes.

WASHINGTON (Reuters) — Consumer spending rose in February and Americans’ outlooks perked up this month, further signs of an acceleration in economic activity in the first quarter after a near stall late last year.

Data reported on Friday also showed a rebound in income growth, putting the economy in a better shape to deal with tighter fiscal policy, particularly $85 billion in across-the-board federal government spending cuts known as the sequester.

“The economy is in a good place now in terms of momentum and strength, and it will need it as the government spending cuts will take something off growth as the year progresses,” said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ in New York.

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