By Eric Morath and Jeffrey Sparshott

WASHINGTON-Household spending slowed in November and incomes were flat, signs that recent economic momentum may have eased during the month that included the presidential election.

Personal consumption, which measures how much Americans spent on everything from groceries to airfare, rose 0.2% in November from a month earlier, the Commerce Department said on Thursday. Incomes were essentially unchanged in November from October.

Economists surveyed by The Wall Street Journal had expected November personal spending and incomes to both rise 0.3%. Spending for October was revised up to a 0.4% gain from an initial estimate of up 0.3%. Incomes in October advanced 0.5% versus a previous reading of up 0.6%.

Consumer spending accounts for about two-thirds of total output in the U.S. and household outlays have been the main driver of economic growth throughout much of the expansion. Consumer spending was solid during the summer months and propelled the economy to grow at an 3.5% pace, the best quarterly increase in two years.

November's spending increase was softer, hinting that the economic expansion isn't likely to maintain last quarter's strength in the final months of the year.

In November, spending on goods intended to be used quickly, such as gasoline and clothing, rose a mild 0.1%. Some retailers reported a slow start to November sales, as the presidential-election campaign concluded, but then saw a pickup late in the month, as the holiday-shopping season was in full swing.

Outlays on longer-lasting goods, such as cars and appliances, fell 0.6% in November. Spending on services, such as doctor visits, rose 0.3%.Meanwhile, consumer prices held flat in November.

The personal-consumption expenditures price index, the Federal Reserve's preferred inflation measure, was unchanged in November, after a 0.3% increase in October. The price measure had risen at a modest pace each month since March, reflecting stabilizing energy prices and somewhat firmer consumer demand allowing businesses to pass along price increases.

One factor countering rising energy prices is a stronger dollar, which makes foreign products relatively less expensive for American consumers. The dollar, which had stabilized this summer, strengthened further after Donald Trump was elected president in November.

From a year earlier, the index was up 1.4%. While still below the Fed's 2% target, it matches October as the firmest year-over-year increase in two years.

"As the transitory influences of earlier declines in energy prices and prices of imports continue to fade and as the job market strengthens further, we expect overall inflation to rise to 2% over the next couple of years," Fed Chairwoman Janet Yellen said last week.

The Fed acted this month to raise its benchmark interest rate for the first time in a year. Policy makers indicated the pace of rate increases could quicken in 2017. However, inflation readings holding well below 2% could be a challenge for policy makers.

So-called core prices, which exclude the volatile categories of food and energy, also held flat from the prior month and were up 1.6% from a year earlier. That was the weakest annual increase since July.

When adjusting for inflation, Thursday's report showed consumer spending rose 0.1% in November from the prior month. Inflation-adjusted disposable personal income--income after taxes--was down 0.1%.

Americans saved a smaller share of their income last month. The personal saving rate fell to 5.5% from 5.7% the prior month.

The Commerce Department report on personal income and spending can be accessed at http://www.bea.gov/newsreleases/rels.htm.

Write to Eric Morath at eric.morath@wsj.com and Jeffrey Sparshott jeffrey.sparshott@wsj.com.

The Commerce Department report on personal income and spending can be accessed at http://www.bea.gov/newsreleases/rels.htm.

(END) Dow Jones Newswires

December 22, 2016 10:15 ET (15:15 GMT)

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