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Personal income edges higher

By Hibah Yousuf, staff reporter

NEW YORK (CNNMoney.com) -- Personal income edged up slightly in January, and spending by individuals rose for a fourth straight month, according to government data released Monday.

The Commerce Department reported that income rose a modest 0.1%, or $11.4 billion, during the month, after a downwardly revised 0.3% hike in December. Economists surveyed by Briefing.com expected the figure to rise 0.4%.

Though the number missed expectations and is the smallest increase since September, it is in line with the average change in personal income over the last 12 months.

Spending by individuals jumped 0.5% in January, or $52.4 billion, above analysts expectations for a 0.4% rise. Personal spending, which has climbed each month since November, was revised up to 0.3% in December.

Personal savings totaled $367.2 billion in January, or 3.3% of disposable income, compared to $467.9 billion in December.

The report follows the Commerce Department's second reading of gross domestic product, the broadest measure of the nation's economic activity, during the last three months of 2009 released last Friday. The revision showed that economic activity accelerated to an annual rate of 5.9% during the fourth quarter, up from the 5.7% growth the government previously reported.

But the strong end to the year was led by businesses and the federal government. The GDP report showed that consumers increased individual spending by an annual rate of 1.7% during the quarter.  To top of page

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