WASHINGTON – U.S. personal spending last month had its steepest month-over-month decline since 2001, even as personal income continued to rise, according to the U.S. Commerce Department’s Bureau of Economic Analysis. As a result, the nation’s personal savings rate more than doubled.
Compared with September, personal consumption expenditures (PCE) fell $102.8 billion, or 1.0 percent, after falling 0.3 percent the month before, the BEA said. Adjusted for inflation, “real” PCE fell 0.5 percent, after falling 0.4 percent the month before.
Meanwhile, personal income last month rose $42.4 billion, or 0.3 percent, compared with September and disposable personal income (DPI) rose $45.1 billion, or 0.4 percent. Adjusted for inflation, “real” DPI rose 1.0 percent in October, after edging up less than 0.1 percent the month before.
Personal savings – DPI minus personal spending and certain other outlays – rose last month to $260.9 billion, or 2.4 percent of DPI, from September’s $110.8 billion, or 1.0 percent.
A separate report today from the U.S. Department of Commerce showed that durable-goods orders fell 6.2 percent in October – the sharpest decline in two years and nearly twice as sharp as analysts had expected. “Everybody is cutting back at the same time,” Christopher Low, chief economist at FTN Financial in New York, told Bloomberg News. “This takes us out of the generic recession category and puts us in the severe recession category.”
ISO 9001:2026: A Practical Opportunity to Build for What’s Next
For Rhode Island manufacturers, ISO 9001 has been much more than a certificate on the…
Learn More
Not all the news was bad, however. The U.S. Department of Labor’s Employment and Training Administration (ETA) today reported that new claims for unemployment benefits fell 14,000 last week to 529,000, from the previous week’s 16-year high of 543,000.
Additional information, including the 12-page Personal Income and Outlays report, is available from the U.S. Commerce Department’s Bureau of Economic Analysis at www.bea.gov.
