Consumer spending fell in December as households took a breather following a surge in buying over the previous two months.
Household purchases declined 0.3 percent, the biggest decline since September 2009, after a 0.5 percent November gain, Commerce Department figures showed Monday in Washington. The median forecast of 68 economists in a Bloomberg survey called for a 0.2 percent drop. Incomes and the saving rate rose.
Consumers responded to early promotions by doing most of their holiday shopping in October and November, leading to the biggest jump in consumer spending last quarter in almost nine years. For 2015, a pick-up in wage growth will be needed to ensure households remain a mainstay of the expansion as the economy tries to ward off succumbing to a global slowdown.
“Consumers are in a good mood coming into 2015, and we think that’s likely to continue,” said Russell Price, a senior economist at Ameriprise Financial Inc. in Detroit, who correctly forecast the drop in outlays. “The prospects for 2015 look very encouraging.”
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