U.S. consumer purchases climbed in December by the most in three months as incomes picked up
The U.S. Commerce Department figures show a 0.5% advance in consumption, which accounts for about 70 percent of the economy, followed a 0.2 percent advance in the prior month The December increase matched the Bloomberg median forecast. Incomes rose 0.3%, less than projected.
Americans increased purchases during the holiday season and sales of automobiles stayed strong, capping a record year for the car industry. Solid hiring, rising wages, and low borrowing costs have increased the wherewithal to spend, while rising sentiment and expectations of lower taxes under President Donald Trump are potential tailwinds.
Adjusting the figures for inflation, consumer spending increased 0.3% in December, also the most in three months. The latest advance was galvanized by a jump in outlays for durable goods, including motor vehicles. In 2016, real household outlays climbed 2.7%, the least in three years.
