Inflation Sees Steep Rise; Consumer Spending Up in November

-High oil prices caused inflation to progress at its fastest pace in two years, but consumer spending rose in November, the Commerce Department said Friday.

Inflation has increased 3.6 percent over the last 12 months, dragging prices up along with it, The New York Times reports.

Consumer spending increased more than most analysts had forecast, rising 1.1 percent in November--its biggest rise in three years. However, the rise may have just reflected the post-Thanksgiving holiday shopping frenzy, the Times says.

When adjusted for inflation, spending rose 0.5 percent last month. Income levels rose 0.4 percent.

The rise in purchasing implied that the economy may be in less danger of slowing than was feared.

The spending data, along with Friday's inflation results, could discourage the Federal Reserve from cutting interest rates at its next meeting, due to its continued concern with inflation.

source: multi-housingnews.com