Inflation is Still Rising

By the U.S. Chamber of Commerce

Each month the Bureau of Economic Analysis (BEA) releases data on income, spending, savings, and inflation. Other than inflation, the October data are positive. Here's the breakdown:

Inflation accelerated. Inflation–the main economic issue right now–rose 0.6% in October.

  • The annual increase was 5%, well above the Fed’s 2% target, and a sizeable jump from September when annual inflation was 4.4%.

Income rose. Income rose 0.5% on the month.

  • Since it rose less than inflation, real income declined slightly.
  • But: Businesses are having to pay more because of worker shortages and inflation. That is one reason business income was flat in October.

Spending rose. Spending jumped a robust 1.3% in October.

  • Spending on goods was up 2.2% and 0.9% on services.

Savings declined. Savings since February 2020 are now $4.7 trillion in aggregate. That’s about $2.7 trillion above trend.

Be smart: Savings since February 2020 are now $4.7 trillion in aggregate. That’s about $2.7 trillion above trend. Americans still have lots of savings built up. It will take many months for Americans to spend down those balances.

—Curtis Dubay, Senior Economist, U.S. Chamber of Commerce