US: Personal spending to post growth of 0.5% in October - Nomura
|Research Team at Nomura, notes that the US personal income growth picked up a bit in September, increasing by 0.3% from 0.2% previously and expects the pace of income growth to increase again to 0.4% m-o-m (Consensus: 0.4%) in October as total aggregate weekly earnings grew at a strong pace over that month.
Key Quotes
“On the spending side of the ledger, we expect another solid month of personal consumption in October. Retail sales grew by a strong 0.8% m-o-m in October and the gains were broad based across various categories. Strong vehicle sales coupled with strong performance in durable goods categories from the retail sales report suggest that demand for durable goods accelerated in October. Also, given strong spending on food and beverage stores and apparel, we expect spending on nondurable goods picked up. On service spending, we expect trend-like gains as weak energy service demand and a slowdown in business at food services and drinking places likely offset gains in other service categories. Together, we forecast personal spending growth of 0.5% m-o-m (Consensus: 0.5%) in October.”
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