Investing.com –U.S. consumer spending rose less than expected in October, while core PCE prices increased in line with forecasts, official data showed on Wednesday.
In a report, the Commerce Department said that personal spending increased just 0.3% in October from the prior month, below expectations for a rise of 0.5% and compared to a rise of 0.7% in September, that was revised an initial gain of 0.5%.
Consumer spending is the single biggest source of U.S. economic growth, accounting for as much as two-thirds of economic activity.
Personal income, meanwhile, rose by a seasonally adjusted 0.6% in October, compared to expectations for 0.4% advance. That was after rising 0.4% (initially a 0.3% gain) a month earlier.
Real personal consumption inched up by a seasonally adjusted 0.1% last month, compared to September’s 0.5% rise, that was revised up from an initial increase of 0.3%.
Meanwhile, the core PCE price index rose 0.1% last month, matching expectations and September’s advance.
The core PCE price index rose at an annualized rate of 1.7% in October, also in line with forecasts and matching the gain registered in the previous two months.
The Federal Reserve uses core PCE as a tool to help determine whether to raise or lower interest rates, with the aim of keeping inflation at a rate of 2% or below.
Immediately following the report, EUR/USD was trading at 1.0642 from around 1.0617 ahead of the release of the data, GBP/USD was at 1.2472 compared to 1.2458 previously, while USD/JPY was at 113.16 from 113.45 earlier.
The US dollar index, which tracks the greenback against a basket of six major rivals, was at 101.11, compared to 101.32 ahead of the report.
Meanwhile, U.S. stock futures pointed to flat open. The Dow futures gained 0.24%, the S&P 500 futures advanced 0.25%, while Nasdaq 100 futures inched down 0.01%.
Elsewhere, in the commodities market, gold futures traded at $1,188.00 a troy ounce, compared to $1,182.50 ahead of the data, while crude oil traded at $48.47 a barrel from $48.48 earlier.