The Commerce
Department reported on Friday that consumer spending in the U.S. jumped 0.7 per
cent m-o-m in December 2023 after an upwardly revised 0.4 per cent m-o-m gain
(from +0.2 per cent m-o-m) in November. This marked the
strongest monthly advance in consumer spending since
September 2023 (+0.7 per cent m-o-m). Economists had forecast a rise of 0.4 per cent m-o-m for December.
Meanwhile,
consumer income went up 0.3 per cent m-o-m in December, following an unrevised 0.4 per cent m-o-m increase in the previous month. This
was the 23rd straight monthly advance in consumer income.
Economists had predicted a 0.3 per cent m-o-m gain.
The December growth
in personal income was mainly due to increases in compensation and personal
interest income.
Elsewhere, the
personal consumption expenditures (PCE) price index, excluding the volatile
categories of food and energy, which is the Federal Reserve's preferred
inflation gauge, rose 0.2 per cent m-o-m in December, following an unrevised 0.1 per cent m-o-m uptick in November. This represented the strongest monthly
increase in the core PCE price in three months. Economists had expected the
indicator would rise 0.2 per cent m-o-m.
In the 12
months through December, the core PCE price index jumped 2.9 per cent, decelerating from an unrevised
3.2 per cent in the 12
months through November. This was the lowest reading
since March 2021 (+2.3 per cent). Economists had foreseen an increase of 3.0 per
cent y-o-y.