U.S. consumer spending picks up growth in December

U.S. consumer spending growth accelerated in December last year, and the inflation also firmed in the month.

Personal spending rose 0.5 percent in December from the previous month, following a revised 0.2 percent gain in November, the Commerce Department said on Monday.

Personal income increased 0.3 percent in December, compared to a modest 0.1 percent growth in the previous month. Meanwhile, personal savings rate declined to 5.4 percent from a revised 5.6 percent in the prior month.

The price index for the personal consumption expenditure (PCE), a gauge for the inflation level preferred by the U.S. Federal Reserve, increased 1.6 percent in December from a year earlier, an acceleration from November' s 1.4 percent increase.

The core PCE price index, excluding volatile food and energy, increased 1.7 percent from a year ago, still below the central bank's target of 2 percent.

Rising inflation gives the Fed more leeway to raise interest rates at a time when the economy is close to full employment.

The U.S. central bank, scheduled to convene policy meeting this week, is not expected to raise interest rates at this meeting. The Fed lifted its benchmark interest rates in last December by 25 basis points. Enditem