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2% Bump in September Clothing, Footwear Spend

Consumer spending on clothing and footwear increased a seasonally adjusted 2 percent in September to $514.29 billion, the second consecutive monthly rise, the U.S. Bureau of Economic Analysis (BEA) revealed Friday in its “Personal Income and Outlays” report.

Spending on furnishings and durable household equipment went in the opposite direction, falling 0.6 percent in the month after a substantial gain in August.

National Retail Federation (NRF) chief economist Jack Kleinhenz said earlier this month that some back-to-school spending may have spilled over from August into September because of school districts that delayed opening until after Labor Day.

“Overall, the September report is very promising for a strong finish for the year,” Kleinhenz said. “Nonetheless, rising inflation and slower supply chains remain a concern. Spending might have been higher if not for shortages of items consumers are eager to purchase.”

According to the U.S. Census Bureau, clothing and clothing accessories store sales were up 1.1 percent month-over-month. Furniture and home furnishings store sales rose 0.2 percent for the month.

BEA reported that overall personal consumption expenditures (PCE) increased 0.6 percent, or $93.4 billion, according to BEA. Real PCE, adjusted for inflation, increased 0.3 percent, with goods inching up 0.1 percent, or $29.9 billion, and services rising 0.4 percent, or $63.6 billion.

BEA said within goods, an increase in spending for nondurable goods was partly offset by a decrease in durable goods. The decrease in durable goods primarily reflected a decline in motor vehicles and parts, led by new motor vehicles.

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The PCE price index increased 0.3 percent. The core PCE Index, excluding food and energy, rose 0.2 percent. The PCE price index for September increased 4.4 percent from a year earlier, with upward movement in goods and services. Energy prices increased 24.9 percent, while food prices increased 4.1 percent. Excluding food and energy, the PCE price index for September increased 3.6 percent from a year earlier.

Personal income dipped 1 percent, or $216.2 billion, in September. according to BEA. Disposable personal income (DPI), a barometer for retail spending, decreased 1.3 percent, or $236.9 billion. Real DPI decreased 1.6 percent in the month.

The decrease in personal income in September was mainly attributed to a decline in government social benefits, including unemployment benefits due to decreases in payments from the Pandemic Unemployment Compensation program, the Pandemic Emergency Unemployment Compensation program and the Pandemic Unemployment Assistance program, BEA noted.

Personal outlays increased $92.1 billion in September. Personal saving was $1.34 trillion in September and the personal saving rate–personal saving as a percentage of disposable personal income–was 7.5 percent.