US personal income falls, spending rises in October

By Ovunc Kutlu

ANKARA (AA) - Personal income declined in the US but spending increased in October from the previous month, according to data released Wednesday by the Department of Commerce's Bureau of Economic Analysis.

Personal income in October dropped $130.1 billion, or 0.7%, from the previous month. Analysts expected a rise of 0.1% month-on-month, while it rose 0.7% in September.

"The decrease in personal income in October was led by a decrease in government social benefits," the department said in a statement.

Personal spending, viewed as the main engine of overall economic activity, rose $70.9 billion, or 0.5%, in October. While the market expectation was a 0.4% increase, consumer spending gained by 1.2% in the month before.

"The leading contributor to the increase in spending for goods was recreational goods and vehicles," the statement said.

Despite the rise in consumer spending, the US stock market was mixed on Wednesday with tech companies gaining again.

The Dow Jones, which climbed above the record level of 30,000 the previous day, was down at 29,909 points for a daily loss of 0.5% at 1025 EDT (1525GMT). The S&P 500 was at 3,624 points with a 0.3% decline.

The Nasdaq, on the other hand, was struggling to stay on positive territory at 12,040 points with less than 0.1% gain with Amazon and Zoom carrying the index with a 2% and 4% rise, respectively.

Precious metals, which posted losses on Tuesday, were recovering on Wednesday with gold up 0.3% and silver rising 0.6% at the same time.

Crude prices were gaining with positive sentiment that global oil demand would recover in 2021 amid COVID-19 vaccine developments.

After posting a 3.9% rise on previous day, price of Brent crude was up 0.6% on Wednesday and the US' West Texas Intermediate was up 0.9% after soaring 4.3% on Tuesday.