WASHINGTON, DC: US consumer spending fell by 1% to $102.4 billion (€79.8bn; £72.1bn) in December 2008 compared with November, the sixth straight month in which a decline has been recorded, according to the Commerce Department.
When adjusted for inflation, consumer spending actually rose by 0.3% in December, but was still down on the expansion of 0.8% in November.
Says Stuart Schweitzer, global markets strategist at JP Morgan's Private Bank: "Consumers now are forced to look to their monthly paychecks as the primary source of spending power, especially when they are reluctant or less able to access those sources of credit that were so important to their spending in years past."
By contrast with the spending figures, the savings rate rose to 3.6% in the final month of 2008 from the 2.8% recorded in November.
The Institute for Supply Management also reported that US manufacturing output rose on December's figures by 2.7% in January to a total of 35.6%, but this was still well below the 50% score that indicates the sector is growing.
However, Schwetizer argues that the slight increase in output demonstrates that "companies are getting a handle on their inventory positions."
Data sourced from Washington Post; additional content by WARC staff