U.S. Consumer Spending Grew in October
U.S. consumers are starting to spend more, a sign that Americans may be a bit more comfortable financially heading into the holiday season. In October, U.S. consumer spending grew about 7% from September, but remained down 5% from a year earlier, according to a Gallup poll released Thursday.
Lower-income consumers boosted their average daily spending by about 6% during the month while upper-income consumers increased their spending by about 8%, according to Gallup. Overall, Americans spent approximately $63 a day, up from $59 in September but down from $66 in October 2009.
"Lower- and middle-income spending is sensitive to job market conditions," Gallup said in a statement. "If job trends continue to improve and confidence along with them, consumer spending could be better than expected late this holiday season."
While U.S. gross domestic product grew 2% during the third quarter and consumer spending grew at its fastest pace in almost four years, the unemployment rate -- which remained steady at 9.6% -- has been at least 9.5% for 14 months, the longest such stretch since the 1930s, according to Labor Department statistics.
Still, the U.S. economy added about 150,000 jobs in October, while third-quarter consumer spending increased at a 2.6% annual pace in the quarter -- its fastest pace since the fourth quarter of 2006 and up from 2.2% in the second quarter.