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Tuesday, March 19, 2024
March 19, 2024

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Consumer spending posted a weak 0.1 percent increase in October

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WASHINGTON — Consumer spending posted a modest increase for a second straight month in October, while personal income rebounded after a sluggish September.

Spending edged up 0.1 percent after a similar tiny gain in September, the Commerce Department reported Wednesday.

Incomes jumped 0.4 percent, double the rise in September. Wages and salaries climbed 0.6 percent. That was the strongest wage gain in five months.

The second straight month of spending weakness could signal trouble, given that consumer spending accounts for 70 percent of economic activity. However, economists are counting on the strong labor market to bolster the incomes needed to fuel spending in the months ahead.

In October, spending on durable goods such as cars was flat following a 0.5 percent rise in September. Spending on nondurable goods such as food and clothing edged up 0.1 percent after a 1.1 percent drop the previous month.

Spending on services such as haircuts and auto repairs rose 0.1 percent after bigger gains of 0.4 percent in August and September.

With the growth in incomes and a small rise in spending, the savings rate rose to 5.6 percent of after-tax income in October, up from 5.3 percent in September.

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