Personal Income Up 0.2%; Spending Surges 0.7%

Personal spending rose 0.7% in October, more than economists’ estimates, the Commerce Department reported Wednesday.

September consumption declined by a revised 0.6% as car sales eased once the “cash for clunkers” program ended on Aug. 24.

Core personal consumption expenditure, which excludes food and energy expenditures, increased 0.2% in October, the largest increase since April. Core PCE rose 1.4% from a year ago. Total PCE increased 0.2% from a year ago.

Personal income increased 0.2% for the month following an upwardly revised 0.2% increase in September.

Economists polled by Thomson Reuters expected income to increase 0.2% and for consumption to increase 0.5%, according to the median estimate. The core PCE deflator was expected to be 0.1%.

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