U.S. Consumer Spending Increases At Slowest Pace in Six Months
- Jan 31, 2008
Washington, D.C.–Consumer spending rose in December–but not as much as in the previous month, the Commerce Department said Thursday.Personal consumption grew by 0.2 percent from November to December, the slowest pace since June. November spending increased by a revised 1.0 percent; November spending originally was perceived to be 1.1 percent higher, the Wall Street Journalreports.After adjusting for inflation, consumer spending–which comprises roughly 70 percent of the economic activity in the U.S.–was flat.Gross domestic product government data released Wednesday indicated consumer spending slowed in from the third to the fourth quarter. The personal consumption expenditures (PCE) index also increased 0.2 percent in December, excluding food and energy. Personal income grew at a seasonally adjusted rate of 0.5 percent compared to November, the Commerce Department report said.In addition, after declining for four consecutive weeks, unemployment claims increased last week to the highest level since 2005, according to a government report released Thursday; however, some of the increase was attributed to factors surrounding the recent Martin Luther King Jr. Day holiday, the Journal said.Initial benefit claims rose by 69,000 after seasonal adjustments in the week ending Jan. 26, according to the Labor Department.