- Euro area: Retail Sales (Aug)
- Sweden: Services PMI (Sep), IP, Industrial Turnover (Aug), Services Index (Aug)
- Qatar: BOP (Q2); Turkey: CPI, PPI (Sep)
- Spain: Sales, Wages and Employment of Large Firms (Aug)
- Markit PMI: Service Survey - Japan,Ireland PMI (Sep); Composite -Japan, Singapore, Ireland PMI (Sep)
- Japan: Wage Indexes (Aug-Prelim)
- Australia: PSI, TD-MI Inflation Gauge Index, Average
- more updates...
Economy in Brief
EMU PPI Collapses as HICP Turns to Show Deflation
The August PPI in the EMU fell by 0.9% after falling by 0.3% in July...
U.S. Light Vehicle Sales Continue To Improve
Strength in employment and income combined with minimal pricing power continues to generate buying at new car...
U.S. ISM Factory Index Weakens to Two-Year Low; Prices Decline
Activity in the manufacturing sector is continuing to lose steam...
U.S. Construction Spending Improvement Slows Versus A Strong Spring
The value of construction put-in-place increased 0.7% during August following a downwardly revised 0.4% rise in July...
U.S. Initial Claims for Unemployment Insurance Edge Higher W/W; Trend Sideways
Today's Labor Department report on unemployment insurance applications suggests that the job market remains firm...
Japan's Tankan Survey Tails But Holds High
Japan's Tankan survey of large, medium-sized and small firms showed a drop in its bellwether large company index of manufacturers...
by Tom Moeller March 30, 2012
Personal income increased just 0.2% during February after lessened gains of 0.2% and 0.4% during the prior two months. The latest rise missed expectations for a 0.4% gain. Wage & salary disbursements reflected the improved gains in payroll employment with a 0.3% rise (4.4% y/y). However, the firm gain was offset by another dip in interest income (-3.1% y/y) and just a 0.1% rise (1.0% y/y) in transfer receipts. Disposable personal income rose 0.2% (2.6% y/y) although take-home pay, when adjusted for price inflation, slipped 0.1% (+0.3% y/y), down for the third month in the last four.
Despite these disappointments consumers kept spending. Personal consumption expenditures jumped 0.8% (4.1% y/y), their strongest gain in a year. Earlier figures were revised upward. Expectations had been for a 0.6% rise. The increase was driven by a 3.9% rise (2.6% y/y) in spending on gasoline, a 3.3% gain (9.5% y/y) in motor vehicles and a 1.2% increase (4.4% y/y) in clothing. Spending on recreation also rose a firm 0.9% (7.5% y/y). The rise in gasoline outlays actually translated into a 7.0% y/y decline when adjusted for higher prices. Overall, when adjusted for inflation real PCE increased 0.5% (1.8% y/y), the best gain since June.
All this spending came at the expense of savings. The personal savings rate fell to 3.7% from a downwardly revised 4.3% during January. It remained below the 5.0% level twelve months ago and a 2010 monthly high of 5.8%.
The PCE chain price index rose 0.3% last month (2.3% y/y), the strongest increase since August. The increase reflected a 5.7% rise (10.4% y/y) in gasoline prices after a 0.9% January rise. The core PCE price index ticked up 0.1% and the y/y increase of 1.9% was up from the record low 12-month change of 0.9% reached last December.
The personal income & consumption figures are available in Haver's USECON and USNA databases. The expectations figures are in the AS1REPNA database.
Okun's Law and Long Expansions from the Federal Reserve Bank of New York is available here.
|Personal Income & Outlays(%)||Feb||Jan||Dec||Y/Y||2011||2010||2009|
|Wages & Salaries||0.3||0.4||0.4||4.4||4.3||2.2||-4.3|
|Personal Saving Rate||3.7||4.3||4.7||5.0
|PCE Chain Price Index||0.3||0.2||0.1||2.3||2.5||1.8||0.2|
|Less Food & Energy||0.1||0.2||0.2||1.9||1.4||1.4||1.6|
|Real Personal Consumption