The Commerce Department said personal spending rose 0.4 percent last month, while personal income increased by 0.3 percent. Analysts polled by Reuters had forecast both personal income and spending to rise by 0.2 percent.
When adjusted for inflation, however, spending was unchanged, due largely to rising food and energy costs.
"Spending was a little hot, but at the same time the cost of food and energy are skyrocketing so that's not that surprising. At the same time, it was higher than what people thought," said Beth Malloy, bond market analyst at Briefing.com in Chicago.
The personal consumption expenditure price index, a key inflation gauge, rose 0.4 percent in January after an upwardly revised increase of 0.3 percent in December. The index has
surged 3.7 percent over the past year, the biggest year-on-year gain since September 2005.
Excluding volatile food and energy costs, the index was up 0.3 percent -- in line with analysts' expectations and the steepest monthly rise since September.
On a year-over-year basis, this "core" price index rose 2.2 percent, matching the prior month's gain.
Many officials at the Federal Reserve, which has cut interest rates sharply since mid-September in a bid to combat recession risks, have said they prefer to keep the core price
gauge in a 1 percent to 2 percent range.
The report on consumer spending, showed Americans dug into their savings for a third straight month in January, as the personal savings rate stood at a negative 0.1 percent of
disposable personal income.
--Reuters contributed to this story