Pouring cold water over a winged optimism that a fairy tale of United States’ record long economic expansion entering in to its 127th month would likely to gather momentum over the coming years, US Commerce department's December data had resounded a growing outcry in US consumer spending, the lifeline of US economy’s decade long economic expansion accountable for roughly two-thirds of United States’ entire economic activity.
Nonetheless, despite a steady US consumer spending in December amid a strident holiday quarter sales, Friday’s (January 31st) data pointed to a tepid earnings’ which would likely to lead to a moderation in consumer spending, while a moderate consumer spending coupled with a rock-bottom business spending would unlikely to proffer a sustained boost to US economy’s record-long expansion over the coming months, suggested analysts.
Meanwhile, as US consumer spending posted a 0.3 per cent rise in December, down from a November figure of 0.4 per cent, while US wage growth remained tepid with a 0.1 per cent rise in December, US consumer spending rose by 4.0 per cent in 2019, its smallest gain in more than three years.
Apart from that, referring to a peevish wage growth which would be weighing on consumer spending over the coming years, a chief economist at MUFG in NY, Chris Rupkey said on Friday (January 31st), “The consumer says don’t count on me in 2020, and their support will be critical for growth this year. ”