Personal income in the U.S. rose sharply in January while spending increased less than expected, indicating that consumers are still cautious over economic recovery.
While income increased by $133.2 billion or 1.0 percent, in January month-on-month, personal spending rose $23.7 billion, or 0.2 percent, the Bureau of Economic Analysis (BEA) said on Monday.
Markets had expected both income and spending to rise 0.4 percent. However, core personal consumption expenditures (PCE) price index, which excludes food and energy prices, increased 0.1 percent against economists' expectations of 0.1 percent increase in January.
Personal savings totalled $677.1 billion in January, up from $620.9 billion in December last year. Manufacturing payrolls increased sharply by $7 billion in January. However, services-producing industries' payrolls rose $4.8 billion following a sharp increase of $18.2 billion in the previous month.
Also, government wage and salary disbursements increased $1.9 billion, compared with an increase of $1 billion.