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U.S. consumer spending rebounded in January, snapping six months of declines, and incomes rose unexpectedly, boosted by salary increases for government employees, a government report showed on Monday.
The Commerce Department said spending rose by 0.6 percent, the largest increase since May, after falling by an unrevised 1 percent in December.
Incomes advanced by 0.4 percent, also posting the biggest increase since May, after December's 0.2 percent decrease.
The department attributed to rise in income to pay rises for federal civilian and military employees, as well as cost-of-living adjustments to several government transfer payments programs. It said excluding these factors, incomes would have increased by 0.2 percent in January.
Analysts polled by Reuters had forecast spending rising by 0.4 percent and incomes slipping 0.2 percent.
Savings jumped to an annual rate of $545.5 billion, the highest level since monthly records began in 1959. The savings rate surged 5 percent in January, the biggest advance since March 1995, as households uncertain about the economy prefer to conserve their cash.
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Data is a real-time snapshot *Data is delayed at least 15 minutes