The Commerce Department reported on Friday that consumer spending in the U.S. rose 0.3 percent m-o-m in December, following an unrevised 0.4 percent m-o-m gain in November. Economists had forecast the reading to show a 0.3 percent m-o-m growth.

Meanwhile, consumer income increased 0.2 percent m-o-m in December, following a revised 0.4 percent m-o-m advance in the previous month (originally a 0.5 percent m-o-m climb). Economists had forecast a 0.3 percent m-o-m gain.

The December advance in personal income primarily reflected gains in compensation of employees and personal interest income that were partially offset by a drop in farm proprietors' income.

The personal consumption expenditures (PCE) price index, excluding the volatile categories of food and energy, which is the Fed's preferred inflation measure, went up 0.2 percent m-o-m in December, following a 0.1 percent m-o-m uptick in the prior month. Economists had projected the index would rise 0.1 percent m-o-m.

In the 12 months through December, the core PCE increased 1.6 percent, following a revised 1.6 percent growth in the 12 months through November (originally a 1.6 percent increase). Economists had forecast a gain of 1.6 percent y-o-y.