US consumers retreat as income jumps

US consumers guarded their wallets cautiously in December's holiday shopping season, despite a rise in incomes, government data showed Monday. Personal spending was virtually unchanged, falling $2.0 billion or less than 0.1 percent, after rising 0.1 percent in November, the Commerce Department said. Americans bolstered savings as their incomes rose a solid 0.5 percent in December, accelerating from the 0.1 percent rise the month before. Adjusted for inflation, disposable income rose 0.3 percent after slipping less than 0.1 percent in November. The personal saving rate -- the amount of disposable income not spent -- rose to 4.0 percent from 3.5 percent in November. "There weren't any real surprises in the data," said Patrick O'Hare at Briefing.com. The department's data showed inflation remained subdued. The personal consumption expenditures price index, a figure closely watched by the Federal Reserve, rose 0.1 percent in December after edging down less than 0.1 percent in November. The so-called "core" PCE price index, including food and energy, increased 0.2 percent, double the pace in November. For the full year, the data showed rising incomes and spending as the economy managed a tepid recovery from the 2008-2009 economic meltdown. Personal income was up 4.7 percent from 2010, when it rose 3.7 percent. But growth in disposable personal income fell to 3.4 percent from 3.6 percent. Personal spending picked up by 4.7 percent, compared with a 2010 increase of 3.8 percent.