Monday, February 02, 2009

Less Spending, More Savings in December

by Bill McBride on 2/02/2009 08:51:00 AM

From the WSJ: Consumers Spend Less, Boost Savings

U.S. consumers cut their spending during December and they increased savings ... Personal consumption fell 1.0% compared to the month before. ...

Personal income fell at a seasonally adjusted rate of 0.2% compared to the month before, the Commerce Department said Monday....

Personal saving as a percentage of disposable personal income was 3.6% in December, the highest since 4.8% in May 2008. It was 2.8% in November.
The higher savings rate is a step towards repairing household balance sheets.