Global| Jun 01 2015U.S. Personal Income Rebound Generates Little Change in Spending
by:Tom Moeller
|in:Economy in Brief
Summary
Personal income recovered 0.4% during April (4.1% y/y) after remaining unchanged in March, as indicated last month. Expectations had been for a 0.3% rise in the Consensus Economics Forecast Survey. Wages & salaries improved 0.2% (4.6% [...]
Personal income recovered 0.4% during April (4.1% y/y) after remaining unchanged in March, as indicated last month. Expectations had been for a 0.3% rise in the Consensus Economics Forecast Survey. Wages & salaries improved 0.2% (4.6% y/y) following a 0.1% rise, revised from 0.2%. Rental income jumped 0.6% (5.9% y/y) following a 0.5% improvement. Wage & salary income gained 0.2% (4.6% y/y) after a 0.1% uptick. Transfer payments also improved 0.2% (5.8% y/y) following a 0.8% jump. Medicaid payments declined 0.5% (10.9% y/y) after surging during the prior three months. Proprietors income rose 0.2% (1.4% y/y) after declines in four of the previous five months. Dividend income rebounded 1.2% (7.4% y/y) and interest income recovered 1.3% (-0.8% y/y).
Disposable income improved 0.4% (3.6% y/y) following no change. Real disposable income gained 0.3% (3.5% y/y) after a 0.2% decline.
Personal consumption expenditures declined minimally (+2.8% y/y) following an upwardly revised 0.5% rise. Expectations had been for a 0.2% increase. Adjusted for price inflation, personal spending also was little-changed. Durable goods purchases fell 0.8% (+5.3% y/y), pulled lower by a 1.8% drop (+4.6% y/y) in spending on motor vehicles. Furniture spending also was off 1.3% (+4.2% y/y), reversing March's rise. Nondurable goods purchases slipped 0.1% (+1.6% y/y) as gasoline spending dropped 2.3% (+0.5% y/y). Clothing purchases increased 0.3% (1.6% y/y) for the second straight month. Services spending nudged 0.1% higher (2.6% y/y) but recreation services purchases jumped 0.8% (1.0% y/y). Health care expenditures improved 0.1% (5.3% y/y).
Last month's strength in income coupled with no change in spending generated a rebound in the personal savings rate to 5.6% from 5.2%. Personal saving rose 14.7% during the last twelve months.
The chain price index remained unchanged following two months of 0.2% increase. Energy prices fell 1.4% (-20.0% y/y) while food prices were off 0.2% (+1.3% y/y). Durable goods prices improved 0.1% (-2.2% y/y) as nondurable goods prices fell 0.3% (-3.5% y/y). Services prices ticked 0.1% higher (1.7% y/y) for the fifth straight month. The price index excluding food & energy edged 0.1% higher (1.2% y/y), about the same as during the last ten months.
The personal income & consumption figures are available in Haver's USECON database with detail in the USNA database. The consensus expectation figures are in the AS1REPNA database.
| Personal Income & Outlays (%) | Apr | Mar | Feb | Y/Y | 2014 | 2013 | 2012 |
|---|---|---|---|---|---|---|---|
| Personal Income | 0.4 | 0.0 | 0.4 | 4.1 | 4.0 | 2.0 | 5.2 |
| Wages & Salaries | 0.2 | 0.1 | 0.3 | 4.6 | 4.6 | 2.8 | 4.5 |
| Disposable Personal Income | 0.4 | 0.0 | 0.4 | 3.6 | 3.8 | 1.0 | 4.9 |
| Personal Consumption Expenditures | -0.0 | 0.5 | 0.1 | 2.8 | 3.9 | 3.6 | 3.7 |
| Personal Saving Rate | 5.6 | 5.2 | 5.7 | 5.0 (Apr. '14) |
4.9 | 4.9 | 7.2 |
| PCE Chain Price Index | 0.0 | 0.2 | 0.2 | 0.1 | 1.3 | 1.2 | 1.8 |
| Less Food & Energy | 0.1 | 0.1 | 0.1 | 1.2 | 1.4 | 1.3 | 1.8 |
| Real Disposable Income | 0.3 | -0.2 | 0.3 | 3.5 | 2.5 | -0.2 | 3.0 |
| Real Personal Consumption Expenditures | -0.0 | 0.4 | -0.0 | 2.7 | 2.5 | 2.4 | 1.8 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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