U.S. Consumer Spending Falls Sixth Straight Month (Timothy R. Homan)

  Feb. 2 (Bloomberg) -- Consumer spending in the United States fell in December for a record sixth consecutive month, capping the worst year since 1961, a slump that is likely to persist as companies slash payrolls.

  The 1 percent drop in purchases was larger than forecast and followed a 0.8 percent decrease in November, the Commerce Department said today in Washington. The Federal Reserve’s preferred measure of inflation was little changed for a third month.

  The loss of almost 2.6 million jobs last year and record declines in home values have shaken confidence, indicating sales and prices are likely to keep retreating. President Barack Obama is pushing Congress to approve a stimulus package that includes tax cuts intended to boost consumer spending.

  “Consumers continue to be pulling back, and the pace of that does not appear to be easing,” said Julia Coronado, a senior economist at Barclays Capital Inc. in New York, which accurately forecast the drop in spending. “Consumers are not going to be spending anytime soon.”

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