Consumer Spending Down 1% in October

Washington, DC, Nov. 26, 2008--Consumer spending fell 1% last month, the largest decline since September 2001, the Commerce Department reported Wednesday.
 
The result matched analysts' expectations. Real consumer spending fell 0.5%.
 
Personal income rose 0.3% in October after a 0.1% gain in September. Analysts were looking for a 0.1% income gain for October. Real disposable income rose 1% in October.

As expected by analysts, the core personal consumption expenditure price index was unchanged in October. This index gained 0.2% in September, and is up 2.1% in the past year.
 
Consumers' plans were lower for buying automobiles, homes and major appliances.
 
The spending downturn may be picking up steam. The Commerce Department reported Tuesday that consumer spending declined 3.7% in the third quarter -- the first drop in 17 years and the largest in 28 years.
 
"The remarkable resiliency that kept U.S. consumers shopping during the first half of the year is no more," CIBC World Markets analysts wrote in a research note prior to Wednesday's data. "Retailers have been seeing red for several months now as consumers think twice, or even three times, before reaching for their credit cards, and this should continue until next year, when a new government fiscal stimulus package has a shot at boosting sales."