BusinessBusinessincomeconsumer spending

Consumer Spending In November 2012 Rises Most In Three Years

Good News For The Economy
Reuters
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In this Tuesday, Dec. 18, 2012, photo, a person passes a retail store with sale sign displayed in the window in Philadelphia. When it comes to big discounts, better late than never. This holiday shopping season, stores havent been offering the same big discounts as they did in previous years as they tried to lure shoppers in with other incentives,but during the final days leading up to Christmas, shoppers will see more of those jaw-dropping 70 percent off sale signs as stores try to salvage a season that so far has been disappointing. (AP Photo/Matt Rourke)

WASHINGTON, Dec 21 (Reuters) - U.S. consumer spending rose in November by the most in three years as incomes climbed, suggesting fourth-quarter economic growth might be stronger than currently expected.

The Commerce Department said on Friday inflation-adjusted consumer spending rose 0.6 percent, and after-tax income climbed 0.8 percent when adjusting for inflation.

The department gave no indication Superstorm Sandy, which slammed the East Coast in late October and kept many people out of work for weeks, had impacted the data or its collection in November.

Spending before taking into account changes in prices rose 0.4 percent. Economists polled by Reuters had expected nominal consumer spending would rise 0.3 percent last month.

The rise in real spending was the largest increase since August 2009 and suggested purchases by consumers were not taking the hit many expected due to growing fears the economy could slip into recession next year.

Most economists think economic growth will slow in the fourth quarter from the 3.1 percent pace of growth clocked in the prior three months, but Friday's data points to consumers offsetting some of the drag expected from an expected decline in the pace at which companies restock their shelves.

Prices fell 0.2 percent last month and were up 1.4 percent in the 12 months through November, the Commerce Department said. (Reporting by Jason Lange; Editing by Andrea Ricci)

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Before You Go

10 Things The Fast Food Industry Doesn't Want You To Know
McDonald's Grew During The Recession(01 of10)
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McDonald's had higher sales growth in 2008 than in 2006 or 2007, opening nearly 600 stores that year, according to Slate. The chain was able to take advantage of Americans' recession tastes: Cheap, convenient food. (credit:Getty Images)
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One Reddit user claiming to be an ex-McDonald's worker said he once left a bag of chicken nuggets out on the counter for too long and "they melted. Into a pool of liquid." That didn't stop him from loving the nuggets, "still delicious," he wrote. (credit:Getty Images)
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For all their work, fast food workers get very little dough. The lowest paid job category in New York City is "Combined Food Service and Preparation Workers, Including Fast Food," according to Bureau of Labor Department Statistics cited by Salon. (credit:Getty Images)
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