Business World

Better news on consumer spending

Tumbling gasoline prices gave consumers more purchasing power last month and led to a rise in consumer spending, even as personal income sags and Americans continue to worry about their jobs in a rapidly weakening economy.

The Commerce Department reported Wednesday that consumer spending, when adjusted for inflation, rose 0.6 percent in November, its largest gains in two years. The increase followed a 0.5 percent decline in October.

And although the unadjusted rate of consumer spending declined 0.6 percent in November, following a 1 percent drop in October, economists suggested the relative increase in spending was a rare piece of good news for the faltering economy.

Households continue to try to save more money as many Americans adjust to stagnant wages and reduced working hours and brace for the possibility of layoffs. The Commerce Department reported that personal savings increased 1 percent in November compared with 0.7 percent in October. Personal incomes dropped by 0.2 percent last month after increasing 0.1 percent in October.

Meanwhile, weekly jobless claims continued to hit new highs. Employers cut 533,000 jobs in November.

The Labor Department reported on Wednesday that the number of people filing for unemployment insurance for the first time rose to 586,000 in the week ending Dec. 20, up from a revised 556,000 a week earlier.

A Labor Department analyst said auto-related layoffs were a factor behind the rise. The four-week average of initial claims, which smooths out fluctuations, rose to 558,000. That’s the highest since December 1982, when the economy was emerging from a steep recession payday loan.

There was some improvement in the number of Americans continuing to seek unemployment benefits, which dropped slightly to 4.37 million from 4.39 million the previous week. Wall Street economists had expected the number to increase to 4.4 million. Economists consider jobless claims a timely, if volatile, indicator of the health of the labor markets and broader economy. A year ago, initial claims stood at 353,000.

America’s manufacturing sector marked another weak month, with new orders to factories for durable goods falling 1 percent to $186.9 billion, the Commerce Department reported Wednesday. Although it was the fourth consecutive month of declines, the drop was smaller than Wall Street’s expectations of a 3 percent decline.

Helping to drive down that November number was a 37.7 percent drop in demand for commercial aircraft. Industrial production has declined 5.5 percent so far this year as automotive assembly lines shut down and house construction grinds to a near standstill.

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The Associated Press contributed to this report.

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Dieser Beitrag wurde am Saturday, 27. December 2008 um 00:29 Uhr veröffentlicht und wurde unter der Kategorie marketing abgelegt. Du kannst die Kommentare zu diesen Eintrag durch den RSS-Feed verfolgen.

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