·
Personal income for October rose a bit less than expectations
with a 0.4% increase after an unrevised 0.5% September gain.
· The disappointment in last month's income gain, however, was confined to a 3.9% (-8.7% y/y) decline in rental income and a slim 0.1% (2.4% y/y) increase in proprietors' income.
· Wage & salary disbursements jumped 0.6% (5.9% y/y) after an upwardly revised like gain during September. Wages in the private service-producing industries surged 0.7% (6.4% y/y) and factory sector wages grew 0.6% (2.8% y/y) following an upwardly revised 0.1% September uptick. Revisions to the figures for April through September lowered the level of wages & salaries.
· Disposable personal income increased 0.3% (4.9% y/y) after an unrevised 0.5% September increase. Personal taxes jumped 1.2% (12.1% y/y).
· Adjusted for recently lower prices,
disposable personal income rose a firm 0.6% (3.4% y/y) last month after
the 0.8% jump during September. Real disposable income per capita
advanced 0.5% (2.5% y/y).
· Personal consumption rose 0.2% after the downwardly revised 0.2% September decline. Expectations had been for a 0.1% increase. When adjusted for the 0.2% decline in prices, real consumer spending rose 0.4%. A 2.8% m/m decline in unit vehicle sales last month held back the gain in PCE along with a 9.8% m/m decline (-16.8% y/y) in spending on gasoline & oil.
· The PCE chain price index fell 0.2%, helped by last month's 12.1% decline in retail gasoline prices. Gasoline prices in November are down another 0.7% m/m. The 0.2% rise in prices less food & energy prices was a bit firmer than expectations for a 0.1% uptick. In addition, the three month change in core prices crept higher to 2.7% (AR).
· Interest income rose 0.4% (7.6% y/y) while dividend income jumped another 1.1% (11.6% y/y).
· The personal savings rate was a slightly less negative -0.6% last month but so far in 2006 has averaged -0.9%. Should the Decline in the Personal Saving Rate Be a Cause for Concern? from the Federal Reserve Bank of Kansas City is available here.
· The Fed's latest Beige Book covering economic conditions around the country can be found here.