Consumers in the United States increased their personal spending in November according to the U.S. Commerce Department figures released on Friday. Helping Americans go out and spend more was a rise in household incomes last month after being depressed in October by lost wages due to Sandy. Meanwhile the upcoming holiday season sent more shoppers out to retail stores to buy gifts.
Data showed purchases ticked up 0.4 percent last month after a 0.1 percent drop in October. The data is important because consumer spending makes up 70 percent of the US economy. Spending will help sustain economic expansion as businesses rein in investment and global buyers temper demand.
The figures were more than the forecasted range of 0.2 percent to 0.7 percent. The Commerce Department initially reported that October spending declined 0.2 percent.
At the same time separate data on durable goods orders in the U.S. were released which showed a rise in November for a second month, rising 0.7 percent last month after a 1.1 percent gain in October that was larger than previously expected. Durable goods last over three years, such as machinery and electronics.
This showed that businesses are planning to expand next year as they look beyond the fiscal cliff. Tax increases and spending cuts are scheduled to take effect in January unless a US budget deal is reached.
The dollar rose briefly against the yen after the data but most the markets focus is on the fiscal cliff negotiations which have reached a gridlock.