US Nov consumer spending up, savings drop

WASHINGTON, Dec 23 (BestGrowthStock) – U.S. consumer spending rose
for a fifth straight month in November and incomes rose
slightly more than expected, government data showed on
Thursday, reinforcing views of a solid economic growth pace in
the fourth quarter.

The Commerce Department said spending rose 0.4 percent
after increasing by an upwardly revised 0.7 percent in
October.

Economists polled by Reuters had expected spending, which
accounts for about 70 percent of U.S. economic activity, to
rise 0.5 percent last month after a previously reported 0.4
percent gain in October.

The report also showed the Federal Reserve’s preferred
measure of consumer inflation — the personal consumption
expenditures price index, excluding food and energy — rose
0.1 percent after being flat for four straight months.

In the 12 months through November, the core PCE index rose
0.8 percent, the same margin as in October and still the
smallest year-on-year gain since records started in 1960.

The gains in spending were the latest to suggest an
acceleration in the growth pace this quarter after output
increased at a 2.6 percent annualized rate in the
July-September period.

Spending was supported by a 0.3 percent increase in
incomes, which was slightly more than the 0.2 percent rise that
economists had expected. Incomes rose 0.4 percent in October.
Consumers also dipped into their savings to fund purchases.

Spending adjusted for inflation rose 0.3 percent after
advancing 0.5 percent in October. The seventh straight month of
gains bolstered views the spending pace gathered momentum in
the current quarter after growing at a 2.4 percent rate in the
July-September period.

The saving rate slipped to 5.3 percent last month, the
smallest since March, from 5.4 percent in October. Savings
dropped to $614.8 billion, the lowest level since March.
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)

US Nov consumer spending up, savings drop