Commerce Department reports reiterated what was witnessed late last year – that US consumer spending stalled for the month of December.  According to this morning’s report, consumer spending in the world’s largest economy was flat compared to November’s 0.1% uptick.  Instead, consumers elected to replenish their savings – hit hard by  necessity spending over the last year.  With employment concerns still at the forefront of US households – including concerns over home values – the spending lull could continue into the first three months of 2012.

The silver lining, however, was that the national savings rate ticked up to 4% annually, compared to the 3.5% annualized rate in the month of November.  The increase was widely seen as a result of a strong pickup in US incomes for the month, which rose by 0.5%.  With savings being rebuilt, for the moment, it’s an indication that employment increases that have been seen in the last few months are helping to curb depleted household reserves.  In the middle of last year, savings rates slipped as consumers were forced to access savings in order to maintain living standards.

Although the figures do point to some stabilization in the country’s consumer base, they do point to potentially slower and more drawn out growth in the coming quarters.  Consumers are likely to continue to defensively spend – supportive of a slower pace of expansion.