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Monday, November 1, 2010

Personal Income Down 0.1%, Consumption Up 0.2%; Savings Rate Down to 5.3%

Personal consumption rose 0.2% in September, following two months of 0.5% rises. Spending growth was primarily due to increased expenditures on durable goods. This component increased 0.7% over the month. Consumption was 3.7% higher than a year prior.

The faster growth rate of consumption relative to income over the month caused the savings rate to decline by 0.3% to 5.3%. The savings rate has been declining modestly in recent months; however, it still remains elevated relative to most years of the past decade. Households are continuing to desire savings to help rebuild lost wealth and to create a cushion to deal with uncertainty.

As measured by the PCE deflator, prices increased 0.1% over the month. From a year prior, the PCE deflator was 1.4% higher. The core PCE deflator, which excludes energy and food prices, was unchanged over the month and was 1.2% higher from the year prior.













































































 m/m % change Sep Aug Jul Jun May Apr
Personal Consumption 0.2 0.5 0.5 0.0 0.2 0.0
    Real 0.1 0.3 0.3 0.1 0.3 0.0
    Personal Income -0.1 0.4 0.2 0.0 0.4 0.4
Real -0.2 0.2 0 0.1 0.5 0.4
PCE Deflator 0.1 0.2 0.2 -0.1 -0.1 0.0
Core PCE Deflator 0.0 0.1 0.1 0.1 0.1 0.0
Savings Rate (level) 5.3 5.6 5.7 6.0 6.0 5.8

10.11.01 (Source: Bureau of Economic Analysis)

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