“U.S. consumer spending fell in October, partly reflecting the effects of superstorm Sandy. The bad start to the fourth quarter of the year, coupled with a mixed third-quarter gross domestic product report out earlier this week, was enough to trigger downgrades to a handful of forecasts.
Macroeconomic Advisers chopped three-tenths of a percentage point from its fourth-quarter tracking estimate, and now expects 1.1% growth.
“Unexpected weakness in real [personal consumption expenditures] in October combined with weakness in personal income through October suggests less PCE growth in the fourth quarter,” the firm said.
Barclays Bank reduced its GDP tracking estimate by four-tenths of a point to 1.8%, but cautioned that a rebound in consumer spending could boost that later this year. “All in all, clearly a very soft start to consumption in 4Q,” Barclays said.”If you enjoy the content at iBankCoin, please follow us on Twitter