U.S. Personal Spending Up 0.8% in October -- Update

By Harriet Torry

U.S. households sharply boosted spending in October as the pace of underlying inflation eased.

Personal spending increased 0.8% from the prior month, the Commerce Department said Thursday. The department's inflation gauge--the personal-consumption expenditures price index--rose 6% in October compared with the same month a year ago, marking an easing from 6.3% in September.

Core inflation, excluding food and energy, was 5% in October compared with a year ago, down from 5.2% the prior month.

On a month-over-month basis, overall inflation was up 0.3% in October and September. The core price index rose 0.2% in October, an easing from 0.5% the prior month.

"Households are heading into the holiday season in fairly good shape," said Ryan Sweet, chief U.S. economist at Oxford Economics. He said that he expects that "all in all, it's going to be another solid holiday shopping season, with unemployment low and wage growth still solid."

October's spending increase was driven by purchases of new vehicles, as well as by spending on food and housing.

Write to Harriet Torry at [e-mail]

(END) Dow Jones Newswires

12-01-22 0909ET