"Put simply, consumption can't continue to grow at an annualized rate of 2% without a rebound in jobs and income growth"
- economist Paul Dales of Capital Economics
Consumer spending in the world's biggest economy advanced more than expected, boosted by the 0.4% pickup in incomes, a sign the biggest part of the nation's economy is recovering. According to the Commerce Department, U.S. consumers increased their spending by 0.8% last month, after a 0.5% gain in the previous month. Analysts had predicted spending, which accounts for around 70% of the economy, to increase 0.6% in September.
"The strength in September gives consumer spending a good lift for the fourth quarter," said Stephen Stanley, chief economist at Pierpont Securities LLC in Stamford, Connecticut. "The housing market seems to have turned. Consumers are clearly feeling better and are going out and spending a bit more."
"Put simply, consumption can't continue to grow at an annualized rate of 2% without a rebound in jobs and income growth," said economist Paul Dales of Capital Economics.
U.S. stock markets were closed on Monday, due to the arrival of Hurricane Sandy.
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