US consumer spending slows as savings rise
Consumer spending in the US rose less than forecast in September as incomes dropped for the first time in more than a year -- a sign Americans may keep rebuilding savings and paring debt as the economy is slow to recover.
Purchases increased 0.2pc, the smallest gain in the third quarter, new figures showed.
Incomes fell 0.1pc, the first drop since July 2009; and the Federal Reserve's preferred measure of inflation stagnated, capping the smallest 12-month gain in nine years.
The report showed the damage being done by unemployment near 10pc, one reason why Fed policymakers may pump more money into the financial system after they meet this week.
Inflation is retreating as retailers like Wal-Mart Stores and Target sweeten discounts to try to spur sales heading into the holiday season.