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Consumer spending declines due to superstorm Sandy

Consumer spending in the United States unexpectedly declined in October, the US Commerce Dept. reported today.

Hurricane sandy satellite 2012 11 27Enlarge
Many experts say natural disasters like Hurricane Sandy will become more prevalent as the climate continues to warm. (NASA/Getty Images)

Consumer spending in the United States unexpectedly declined in October, the US Commerce Dept. reported today, and economists say that’s due to superstorm Sandy, which slammed into the Northeast on Oct. 29, the Associated Press reported.

Purchases dipped 0.2 percent, the weakest spending numbers since May, as shoppers and workers sheltered at home, Bloomberg News reported. Consumer spending had increased 0.8 percent the month before.

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Incomes stagnated, as work missed due to Sandy depressed wages, the Commerce Dept. said, according to Bloomberg News.

The Sandy effect has lingered into November, according to the AP. The International Council of Shopping Centers said it had expected sales growth between 4.5 percent and 5.5 percent at 18 major retailers this month, but reported sales only rose 1.7 percent, the AP reported.

“Holiday sales will be a little weaker than we originally thought and part of the blame is that hurricane Sandy took out some of the momentum,” Chris Christopher, an economist at IHS Global Insight Inc., in Lexington, Mass., told Bloomberg News. “When all is said and done, consumers are not performing robustly, but they have a few things in their favor. Gas prices have fallen and the housing market is showing some traction.”

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http://www.globalpost.com/dispatch/news/regions/americas/united-states/121130/consumer-spending-october-declines-superstorm-sandy