WASHINGTON — Consumer spending posted a 0.5% increase in November, a healthy gain despite the jolt from the stock market crash, even as personal income fell at its steepest rate in 15 years, the government said today.
The Commerce Department said that purchases of durable goods, the category that includes cars, rose at an annual rate of $10.2 billion after declining at a rate of $24.7 billion in October.
The gain in consumer spending followed declines of 0.2% in September and October.
The 0.4% decline in personal income was caused by a drop in farm subsidy payments. Without the swing in farm incomes, personal incomes would have actually risen 0.7% in November. Analysts said this figure was more of a reflection that personal incomes are continuing to rise at a respectable pace.
The 0.4% drop in overall incomes was the largest fall-off since a 0.6% plunge in June, 1972.