Ahead of tomorrow's non-farm payroll report, the Labor Department reported that initial jobless claims fell to their lowest level in 3 weeks for the week ended October 27. First-time claims for unemployment benefits fell to 327,000, a decline of 6,000. Conversely, continuing jobless claims reached their highest level since September 1, adding 65,000 to hit 2.58 million. The 4-week moving average of continuing jobless claims which smoothes out one-time occurrences such as holidays or weather events rose by 13,000 to 2.53 million.
Checking in on spending and incomes, the Commerce Department said this morning incomes rose 0.4% and spending edged 0.3% higher in September, matching Wall Street's expectations. After-tax incomes increased just 0.2% for the month after adjusting for inflation, while real spending crept 0.1% higher. September's figures mark the slowest growth in real disposable incomes since May, while spending hit its lowest level since June. With growth in incomes outpacing spending, the personal savings rate moved slightly higher, reaching 0.9% from 0.8%.
As for inflation, the personal consumption expenditure (PCE) index added 0.2% for the period, while core PCE excluding food and energy prices matched the 0.2% gain. PCE has risen 2.4% for the year, while core PCE is up 1.8%.