US Personal Income Rose 0.2% in September as Spending Climbed 0.5%
Americans earned more but spent faster in September, pushing the personal saving rate down to 3.8%, BEA data shows.
Personal income in the United States increased $54.5 billion, or 0.2 percent, in September, the U.S. Bureau of Economic Analysis reported, as consumer spending outpaced income gains for the month.
Personal consumption expenditures — the broadest measure of household spending — rose $113.1 billion, or 0.5 percent, more than double the pace of income growth. Total personal outlays, which include interest payments and transfer payments in addition to consumption, climbed $113.0 billion over the same period.
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Disposable personal income, which strips out current taxes, also gained 0.2 percent, rising $52.7 billion. Despite the income growth, the gap between earnings and spending left Americans saving at a rate of 3.8 percent of disposable income, with aggregate personal saving at $911.1 billion. The divergence between income and spending growth signals that households drew down a larger share of available resources during the month.
The PCE figures carry particular weight for policymakers, as the Federal Reserve uses the PCE price index — derived from the same underlying data — as its preferred inflation benchmark. Sustained spending momentum, even when it outstrips income, can factor into assessments of consumer demand and broader economic conditions.
Continue reading at U.S. Bureau of Economic Analysis.
