Income, spending and prices fall in month

December 24, 2008

U.S. personal income and disposable funds decreased in November, the U.S. Commerce Department said Wednesday.

Personal income decreased 0.2 percent, or $20.7 billion, while disposable income fell 0.1 percent, or $11.8 billion, the Commerce Department said.

While wages and salaries fell $8.7 billion, consumer spending fell 0.6 percent after a 1-percent decline in October.

Prices also fell. In November prices fell by 1.1 percent following a decline of 0.5 percent in October. Core inflation, excluding food and energy costs, was essentially unchanged in the month, the department said.

While consumers pull back from spending — and have less to spend — savings have gone up in total and as a percentage of disposable income.

Personal savings grew from $252.3 billion in October to $298 billion in November. In contrast, personal outlays shrank by $57.4 billion in the month.

As a percentage of disposable income, savings grew to 2.8 percent in November from 2.4 percent a month ago.

Source: upi

comments powered by Disqus