THE LEDGER-STAR
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Thursday, December 1, 1994 TAG: 9412010660
SECTION: FRONT PAGE: A2 EDITION: FINAL
SOURCE: ASSOCIATED PRESS
DATELINE: WASHINGTON LENGTH: Short : 35 lines
Americans' income surged 1.4 percent in October, the ninth straight increase and the biggest jump in eight months.
The Commerce Department also reported today that spending rose 0.7 percent in October, the strongest showing since it advanced 0.9 percent in August.
Disposable income - income after taxes - also climbed 1.4 percent in October.
The overall income gain was the largest since it rose 1.7 percent in February. Income last fell in January, when it slipped 0.6 percent.
The increases reported today for both were higher than many analysts predicted.
In September, personal income increased 0.6 percent and spending rose just 0.2 percent.
Consumer spending, which accounts for two-thirds of the nation's gross domestic product, was up for the sixth straight month and eight of the past nine.
The combination of incomes and spending meant that Americans' savings rate - savings as a percentage of disposable income - climbed to 4.7 percent in October, from 4.1 percent the previous month. The savings rate was the highest since April 1993 when it was 5 percent.
KEYWORDS: INCOME SPENDING by CNB