US consumer spending rose 0.4 per cent in January, and personal income was also up 0.4 per cent, the US Commerce Department said today.
This is the strongest monthly gain in consumer spending since October and the largest increase in income since last July.
The gains in both consumer spending and personal income were higher than market expectations. The consensus of Wall Street forecasters called for a 0.3 per cent rise in consumer spending, and income was expected to increase 0.1 per cent.
The rise in spending in January was due to spending on non-durable goods and services. Spending on non-durable goods rose 1.2 per cent, while spending on services rose 0.5 per cent.
Wages and salaries remained flat in January after rising 0.5 per cent in the previous month.
The personal savings rate - personal saving as a percentage of disposable personal income - was 1.8 per cent in January, compared with 0.6 per cent in December.