US DATA: Sept Pers Income -0.1% (biggest drop since Jul’09), PCE +0.2%,
core PCE Prices flat for +1.2% YOY — all worse than expected but
already in Q3 GDP. Pvt wages +$3.3b vs +$23.6b in Aug as mfg dropped and
services cut back. Proprietors’ income and rents gained, but income
receipts -$5.7b and transfers -$21.5b as emergency unemployment benefits
were reduced due to legislation. Savings rate 5.3% (low since Aug’09) vs
5.6% Aug as consumers cut savings as well as spending. Pattern of real
PCE was +0.2% July, +0.3% Aug, +0.1% Sept, showing a slowing consistent
with sluggish growth. Some of the slowing is due to govt programs but it
appears the underlying pace of the economy is not strong.
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