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Consumer spending, income up in November

Consumers spent and earned more in November, reflecting a rebound from the disruptions caused by superstorm Sandy.

The Commerce Department said Friday that consumer spending rose 0.4 percent compared with October. Personal income jumped 0.6 percent, the biggest gain in 11 months.

Economists noted that the spending and income growth in November was a healthy sign for the economy, especially in the midst of anxiety and uncertainty from the stalemate in Washington over the "fiscal cliff."

Wages and salaries rose $41 billion in November. Sandy had reduced wages at an annual rate of $18 billion in October. Spending had fallen 0.1 percent in October compared with September.

With income rising faster than spending, the saving rate rose to 3.6 percent of income in November. That was up from 3.4 percent in October.

Concerns have been rising that income growth has been too weak to support sustained increases in spending, especially when Americans are worried about possible tax increases in the new year from the fiscal cliff.

Consumer spending accounts for about 70 percent of economic activity. -- AP

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