The Commerce
Department announced on Thursday that consumer spending in the U.S. increased
0.2 per cent m-o-m in January 2024 after an unrevised 0.7 per cent m-o-m jump in December 2023. Economists had foreseen a gain of 0.2 per cent
m-o-m for January.
Meanwhile,
consumer income surged 1.0 per cent m-o-m in January, following an unrevised 0.3 per cent m-o-m advance in the previous month. This
represented the strongest monthly advance in consumer income since January 2023 (+1.0 per cent
m-o-m). Economists had expected a 0.4 per cent m-o-m rise.
The January growth
in personal income was mainly due to increases in government social benefits,
personal income receipts on assets, and compensation.
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, increased 0.4 per cent m-o-m in January, following a downwardly revised 0.1 per cent m-o-m gain (from +0.2 per cent
m-o-m) in December. This marked the strongest monthly advance in the core PCE
price since February 2023 (+0.4 per cent m-o-m). Economists had expected the
indicator would go up 0.4 per cent m-o-m.
In the 12
months through January, the core PCE price index jumped 2.8 per cent, easing
slightly from an
unrevised 2.9 per cent in the 12 months through December. This was the softest reading since March 2021 (+2.3 per
cent). Economists
had anticipated a surge of 2.8 per cent y-o-y.