US Consumer spending rebounds in October, inflation elevated
At the same time, consumer prices rose five percent compared with the same period last year, the fastest 12-month gain since the same stretch ending in November 1990.
November 24, 2021 / 10:33 PM IST
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Consumer spending in the United States rebounded in October, rising by a solid 1.3 percent, and so was inflation, rising over the past year at the fastest pace in more than three decades.
The jump in consumer spending last month was double the 0.6 percent gain in September, the Commerce Department reported on November 24.
At the same time, consumer prices rose five percent compared with the same period last year, the fastest 12-month gain since the same stretch ending in November 1990. The surge in prices this year contributed to the 1.6 percent rise in spending in November, yet adjusting for inflation, spending was up a still-solid 0.7 percent after a 0.3 percent inflation-adjusted gain in September.
Personal incomes, which provide the fuel for future spending increases, rose 0.5 percent in October after having fallen one percent in September, a reflection of a drop in government support payments.
Consumer spending, which accounts for 70 percent of economic activity, is being closely watched by economists who believe the strength in this area will lift the overall economy in the final three months of this year.