US consumer spending, income stall; Sandy a factor
WASHINGTON (REUTERS) - United States (US) consumer spending fell in October for the first time in five months and income growth stalled, leading some economists to cut already weak estimates of fourth-quarter economic growth.
Superstorm Sandy was partly to blame for the pullback in spending as the quarter started, but economists said the data on Friday also underscored the economy's fundamental weakness, stemming from the uncertainty over the course of fiscal policy.
The Commerce Department said consumer spending fell 0.2 per cent after a 0.8 per cent increase in September. Income growth was flat as wages and salaries dropped 0.2 per cent, in part because of work disruptions caused by the storm, which lashed the East Coast in late October.
But even stripping out the US$18.2 billion (S$22.2 billion) annual rate hit to wages and salaries from the storm, they would have been flat.