US personal spending unchanged in December but incomes rise, data reveals

US personal spending was unchanged in December even as income rose 0.3%, according to the Commerce Department on Monday.

Analysts had been expecting a 0.1% year-on-year increase in personal spending, compared to November’s 0.4%. Adjusted for inflation, consumer spending climbed 0.1%.

The weak growth in spending reflected cutbacks on purchases of automobiles and low demand for utilities amid unseasonably mild weather.

Personal income increased 0.3% in December, slightly higher than forecasts for 0.2% growth and following a 0.5% gain in November.

“We expect spending in energy to mean-revert in the first quarter, adding some 0.6% to the annualised rate of growth of total consumption, so we’re sticking to our forecast for a 3%-plus increase in headline real spending,” said Ian Shepherds, chief economist at Pantheon Macroeconomics.