U.S. consumer spending rose for a second straight month in November as incomes recorded their biggest gain in six months, data showed on Wednesday, boosting hopes of a self-sustaining economic recovery.
The Commerce Department said spending increased 0.5 percent after rising by a slightly downwardly revised 0.6 percent in October. Consumer spending in October was previously reported to have increased 0.7 percent.
Analysts polled by Reuters had expected consumer spending, which normally accounts for over two-thirds of U.S. economic activity, to rise 0.6 percent last month.
The data was the latest evidence that households were starting to feel comfortable enough to spend after a long period of restraint following the most painful U.S. recession in 70 years.
Data early this month showed a strong rise in retail sales in November, with gains spread across nearly all categories.
Wednesday's report showed spending adjusted for inflation rose 0.2 percent in November, adding to the prior month's 0.4 percent gain. Personal income increased 0.4 percent last month, the largest increase since May, after rising 0.3 percent in October. That was a touch below market expectations for a 0.5 percent increase.
Real disposable income climbed 0.2 percent in November after rising by the same margin in October. The rise in income saw savings increasing to an annual rate of $525.1 billion, but the savings rate was unchanged at 4.7 percent from the prior month.
Commerce Department data also showed the personal consumption expenditures price index, excluding food and energy, rising 1.4 percent from a year ago in November. The index, which is a key inflation gauge monitored by the U.S. Federal Reserve, increased 1.4 percent in October.