Strong U.S. income and spending growth push inflation up

Personal income and spending start Q4 strong, adding some pressure to PCE inflation. Fed still expected to cut rates in December. Initial jobless claims fall to a seven-month low, as labor demand remains healthy. Pending home sales rise more than expected. Durable goods orders disappoint. Along with a weaker Chicago PMI, it points to continued sluggish manufacturing activity into yearend. Q3 real GDP unrevised at a 2.8% annualized rate. Profits soften, but margins still elevated. German and French consumer confidence plunges, adding to downside risk for the eurozone economy.

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