US incomes and spending rose as expected in December, while core consumer prices gained less than anticipated, a government report showed today.
But the US savings rate for all of 2006, a negative 1 per cent, was the lowest since a negative 1.5 per cent rate in 1933, during the time of one of the worst economic depressions in US history, a US Commerce Department report showed.
Incomes rose 0.5 per cent in December after a 0.3 per cent gain in November, while spending climbed 0.7 per cent after a 0.5 per cent rise in November, the report found.
Core consumer prices, which exclude volatile energy and food costs, rose 0.1 per cent in December after being unchanged in November.
Core prices rose 2.2 per cent from December a year ago, the same pace as the 12-month rise in November.
Officials at the Federal Reserve have said they prefer the 12-month rise in core prices to remain between 1 per cent and 2 per cent.
The savings rate slipped to a negative 1.2 per cent in December, the lowest since August. The savings rate has been negative since April 2005, 21 consecutive months.