U.S. Personal Income & Consumer Spending Growth Ease

Personal income increased 0.2% during August (2.8% y/y) following a 0.3% July rise, revised from 0.4%. The latest gain matched expectations in the Action Economics Forecast Survey. Wages & salaries remained unchanged (2.7% y/y) following two months of strong gains. Rental income grew 0.7% (6.5% y/y) after two months of 0.6% increase. Proprietors' income advanced 0.3% (2.9% y/y) following declines in three of the prior four months. Personal interest income improved 0.2% (2.8% y/y) for a second straight month. That followed three consecutive months of 0.9% decline. Dividend income also rose 0.2% (1.5% y/y) after a 0.5% increase. Personal transfer receipts improved 0.3% (2.7% y/y) after two months of 0.2% increase. Social Security payments ticked 0.1% higher (3.3% y/y) and Medicare payments gained an improved 0.3% (2.8% y/y). Unemployment insurance benefits declined 1.0% (-11.2% y/y).

Disposable income inched up 0.1% (2.7% y/y) following a 0.2% rise during July. Adjusted for price changes, take-home pay slipped 0.1% (+1.2% y/y) and reversed July's increase.

Personal consumption expenditures ticked 0.1% higher last month following an unrevised 0.3% rise. A 0.1% gain had been expected. Adjusted for price change, personal spending eased 0.1% (+2.5% y/y), the first decline since January. Real durable goods purchases declined 1.0% (+5.8% y/y), pulled lower by a 2.7% drop (+2.4% y/y) in motor vehicle buying. Real furniture purchases eased 0.2% (+6.3% y/y), but real spending on recreational goods & vehicles rose 0.1% (9.0% y/y). Constant dollar spending on nondurable items fell 0.2% (+1.7% y/y), off for the third straight month. Real purchases of clothing & footwear declined 0.8% (+1.0% y/y). Real spending on gasoline & oil declined 0.9% (-0.9% y/y), down for the fourth month in the last five. Real spending on food & beverages rose 0.3% (1.4% y/y). Real spending on services improved 0.1% (2.2% y/y) for the third straight month. Real outlays on health care rose 0.2% (2.8% y/y) but housing & utilities expenditures eased 0.1% (+0.3% y/y), the sixth monthly decline this year. Real recreation spending held steady for the second straight month (3.2% y/y). 

The personal savings rate held at 3.6%, but remained down from the 6.1% high during all of 2015. Personal saving declined by roughly one quarter y/y.

The chain-type price index increased 0.2% (1.4% y/y), the strongest increase since April. Excluding food & energy, prices increased 0.1% (1.3% y/y) for the fourth straight month. Durable goods prices eased 0.1% (-2.2% y/y), down for the seventh straight month. The price index for recreational goods & vehicles fell 0.7% (-3.8% y/y). Nondurable goods prices rose 0.5% (1.3% y/y) as gasoline prices jumped 5.8% (9.9% y/y). Services prices improved 0.2% (2.0% y/y), following a 0.1% uptick.

The personal income & consumption figures are available in Haver's USECON database with detail in the USNA database. The Action Economics figure is in the AS1REPNA database.