U.S. Recovery Accelerates on Spending, Labor Market Growth
Source: WSJ
Personal spending rose 1.3% in October, while income increased 0.5%
Updated Nov. 24, 2021 3:14 pm ET
The U.S. economy showed broad-based signs of acceleration heading into the end of the year, with consumers ramping up spending, businesses stepping up investment and jobless claims falling to historic lows.
Household spending rose 1.3% in October from a month earlier, while personal income increased 0.5% last month, the Commerce Department said Wednesday. Consumers are benefiting from a strong labor market. And they are spending at a faster pace than inflation, which recently hit a three-decade high.
Jobless claims, a proxy for layoffs, fell to 199,000 last week, the lowest weekly level in 52 years, the Labor Department separately said. The sharp decline in unemployment claims suggests rising wages and bountiful job openings could continue to buttress consumer spending—the economy’s main engine—despite fading government stimulus and dwindling savings.
“Consumer demand remains quite strong,” said Gregory Daco, chief U.S. economist at Oxford Economics. “People are looking to travel. They’re still looking to eat out. They’re still looking to make purchases for the end-of-the-year holidays.”
Elevated inflation, stoked by strong demand and limited goods and labor supply, poses a risk to the economy, though.......................................................
Read more: https://www.wsj.com/articles/consumer-spending-personal-income-inflation-october-2021-11637710533?st=yyvpm3dmc937hmr&reflink=desktopwebshare_twitter
This IS good news. Yet, groceries sure have gone up.
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Strong consumer demand for items including apparel is supporting sales at several of the biggest U.S. retailers.
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