Weekly Market Insight . Personal Income & Personal Consumption Expenditures; Monthly Percent Change, Seasonally Adjusted . 11/28/11

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Personal Income & Personal Consumption Expenditures
Monthly Percent Change, Seasonally Adjusted
November 28, 2011
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Sources: U.S. Bureau of Economic Analysis, Grubb & Ellis
Consumer spending increased by a surprisingly weak 0.1 percent in October while personal income surged by 0.4 percent. To some extent this is payback for the past three months when spending increased at a faster pace than income. The saving rate rose slightly from 3.3 percent in September to 3.5 percent in October. It was 5 percent as recently as June. The low saving rate combined with a strong kickoff to the holiday shopping season on Black Friday (preliminary sales gains up as much as 10 percent from last year) suggest that October’s weak patch in spending could be short-lived. Consumers are responding to pent-up demand and promotional pricing from retailers. The fact that consumers are loosening up despite the weak labor market, worrying headlines from Europe and dismal confidence readings bodes well for the economy heading into 2012. If consumers stay in the game, the retail property market could make a better showing next year than many analysts anticipate.
Robert Bach, Senior Vice President, Chief Economist, has 30 years of professional experience in real estate market research, consulting and city planning. His commentary on the real estate markets is provided here on a weekly basis.

Need more information? Contact:

Robert Bach
Senior Vice President, Chief Economist
312.698.6754

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© 2011 Grubb & Ellis, all rights reserved.
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About CRE Northwest

Specialist in office & investment real estate in Seattle & the Eastside
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