While we already knew last night courtesy of a leak by the BEA that personal spending in November rose by 0.3%, in line with expectations and up from a 0.1% increase the month before, moments ago we got the missing component, which was personal income, and at 0.3%, it too rose 0.3% in October, just above the 0.2% expected, but down from the 0.4% increase in October.
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The total personal income for November, which hit a record $15.618 trillion, an increase of $44.4 billion, was primarily driven by a $37 billion increase in wages, of which $20 billion came from service producing industries, and $14 billion from goods-producing. The government added another $3 billion.
The offset was a $40 billion increase in Personal Consumption Expenditures, which rose as a result of a $24 billion jump in spending on goods and $16 billion on services.
The end result was that in November personal savings was $748 billion, a $9.4 billion decline from the $757 billion a month ago, which translates into a 5.5% savings rate, down from last month's 5.6%, however well above the average rate seen over the past 12 months as consumers continue to be unwilling to dip into their savings despite the so-called "gas" tax cut.
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And while overall consumer spending appears to be indeed slowing down as manifested in the secular decline in GDP, one area that shows promise is"eating out" - at 4.6% of total spending, this was the highest in 20 years.
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