US personal income rises at quicker-than-expected clip in October

Posted on November 30, 2016

US personal income climbed last month at the fastest rate since April, highlighting the growing upward pressure on wages from a tighter job market.

Personal income rose 0.6 per cent in October from September, according to data from the Commerce Department. Wall Street economists had forecast a 0.4 per cent increase.

The report comes after separate data released earlier this month from the Labor Department showed that wages rose in October at the swiftest rate since the US emerged from the financial crisis.

Strength in the labour market has brought the jobless rate to less than half of its crisis-era high. Along with a rebounding economy, these signs have been pegged as a key drivers for the recent pick-up that has sparked hopes that inflation may creep closer to policymakers’ targets.

Indeed, the core personal consumption expenditures price index, the Federal Reserve’s preferred inflation measure, held steady at a year-on-year rate of 1.7 per cent in October, according to Wednesday’s report, from a pace of 1.3 per cent during the same month in 2015. The US central bank is targeting roughly 2 per cent inflation.

Elsewhere, consumer spending rose by 0.3 per cent in October, missing expectations for a rise of 0.5 per cent.

You must be logged in to post a comment Login