Washington, DC, Dec.23--Personal spending rose in November, the government said Tuesday, falling short of Wall Street forecasts, as the holiday shopping season got off to a slower start than expected.
Spending by consumers, which accounts for about 70 percent of the nation's economic activity, rose 0.4 percent after rising a revised 0.1 percent in October, the Commerce Department said. Economists, on average, expected spending to rise 0.7 percent, according to Briefing.com.
The department said personal income rose 0.5 percent after rising a revised 0.2 percent in October. Economists, on average, expected income to rise 0.4 percent.
Though economists expected the growth rate of consumer spending to slow in the fourth quarter, they nevertheless expected a very strong holiday season, as well, thanks in part to signs of strength in the labor market.
Personal income growth--which includes interest and other non-wage income--rose in November at the fastest pace since 0.6 percent in May, driven in large part by 0.3-percent growth in wages and salaries, also the strongest since May and a hopeful sign for future consumer spending.
