Recent Updates
- US: Monthly Treasury Statement, Wholesale Trade (Jun), Consumer Prices (Jul)
- Brazil: Retail Trade (Jul)
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- more updates...
Economy in Brief
U.S. Mortgage Applications Rose Slightly in the Latest Week
Mortgage applications increased 0.2% (-62.9% y/y) from one week earlier...
U.S. Productivity Declines in Q2, Pushing Unit Labor Costs Higher
Nonfarm business sector productivity fell 4.6% (AR) during Q2'22...
U.S. Small Business Optimism Edged Up in July
The NFIB Small Business Optimism Index edged up to 89.9 in July...
U.S. Gasoline & Crude Oil Prices Continue Weakening
Retail gasoline prices declined to $4.04 per gallon (+27.3% y/y) last week...
OECD LEIs Point to a Ramp Down in Growth - and Nothing More
The OECD metrics this month show a broad tendency for growth to slow down...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller February 1, 2007
Personal income increased 0.5% after two months of 0.3% rise and matched Consensus expectations. For the year, income rose 6.4%, faster than the 5.2% gain during 2005.
Wages & salaries jumped 0.6% (6.4% y/y) and for the whole year rose 6.6% after the 5.1% increase during 2005. Last year's gain was the strongest since 2000. Factory sector wages made up for the prior month's slip with a 0.2% (3.8% y/y) increase. The full year gain of 4.7% also was the strongest since 2000. Wages in the private service-producing industries rose a strong 0.8% (7.0% y/y) and for the year rose 7.2%.
Interest income declined 0.4% (+3.0% y/y) for the third consecutive month and earlier months' gains were revised away. Dividend income surged 1.1% (11.7% y/y) for the fourth month and for the year rose 11.3%.
Disposable personal income advanced 0.5% (5.2% y/y), better than the 0.3% increase during November and for the year rose 5.5%. Personal taxes increased 0.7% (10.9% y/y) and for the year rose 13.3%. Real disposable personal income rose 0.2% (2.9% y/y) last month and for the year rose 2.7%. Real disposable income per capita rose 1.8% last year, up from the 0.2% gain during 2005.
Personal consumption surged 0.7% last month after an unrevised 0.5% gain during November and matched expectations. Last month's gain was helped by a 4.4% (-2.1% y/y) increase in unit auto sales. That lowered the year's gain in spending to 6.0% from 6.5% during 2005. Spending on nondurables grew 1.6% last month and 7.0% for the year but adjusted for higher prices nondurables spending grew just 0.6% in December and 3.8% last year. Real consumer spending rose 0.3% after a 0.5% November gain and grew 3.2% for the year, down from 3.5% during 2005.
The personal savings rate was a more negative -1.2% during December and in 2006 averaged -1.0%. 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 PCE chain price index rose a firm 0.4% due to a 3.7% gain in gasoline prices which has since more than reversed. Prices less food & energy ticked up 0.1% after no change in November. The three month change in core prices fell to 1.7% (AR), the lowest since February.
Disposition of Personal Income | December | November | Y/Y | 2006 | 2005 | 2004 |
---|---|---|---|---|---|---|
Personal Income | 0.5% | 0.3% | 5.9% | 6.4% | 5.2% | 6.2% |
Personal Consumption | 0.7% | 0.5% | 6.0% | 6.0% | 6.5% | 6.6% |
Savings Rate | -1.2% | -1.0% | -0.3% (Dec. '05) | -1.0% | -0.4% | 2.0% |
PCE Chain Price Index | 0.4% | 0.0% | 2.3% | 2.8% | 2.9% | 2.6% |
Less food & energy | 0.1% | 0.0% | 2.2% | 2.2% | 2.1% | 2.0% |