WASHINGTON (AP) – U.S. consumer spending rose at the fastest pace in three months in November, while income posted the best gain in five months – both encouraging signs for economic growth.
The Commerce Department said Tuesday that consumer spending increased 0.6 percent in November, double the 0.3 percent October gain and the best showing since August.
Income, helped by a surge of hiring in November, rose 0.4 percent after a 0.3 percent October rise. It was the best showing since a similar rise in June.
Consumer spending is closely watched because it accounts for about 70 percent of economic activity. The government revised higher spending in each month beginning in July. Those revisions contributed to a boost in overall growth to a sizzling 5 percent rate in the third quarter.
Economists think growth will slow to around a 2.5 percent annual rate in the current October-December period, but they believe the economy will remain solid in 2015.