Economists had predicted a rise of 0.2%.
The flat figure was mainly attributed to a fall in fuel prices and a slowing labor market.
US car sales did rise, but core sales, which exclude those, building materials and petrol- dipped by 0.1%.
The disappointing figures make it less likely that the Federal Reserve will raise rates in October.
Slow labor growth in the US is one reason believed to have curbed some discretionary spending by Americans.
Third quarter growth in the US was also revised down to 1.7%.
The Fed is looking for 2% growth to justify increasing its benchmark rate.
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