Global| Mar 01 2013U.S. Personal Income Tumbles, But Spending Inches Up
by:Tom Moeller
|in:Economy in Brief
Summary
Personal income slumped 3.6% last month (+2.2% y/y) after an unrevised 2.6% December jump. A 2.1% decline was the consensus expectation. Last month's fall was due to a one-third drop (-3.3% y/y) in dividend earnings. Income, other [...]
Personal income slumped 3.6% last month (+2.2% y/y) after an unrevised
2.6% December jump. A 2.1% decline was the consensus expectation. Last
month's fall was due to a one-third drop (-3.3% y/y) in dividend earnings.
Income, other than from dividends, also was down by 1.1% (+2.5% y/y). That
decline reflected a 0.6% drop (+2.9% y/y) in wage & salaries following
a 0.7% December rise. Adding to last month's decline was a 0.3% fall
(+1.6% y/y) in interest income. Offsetting these declines was rental
income which jumped 2.3% (13.0% y/y) while transfer receipts rose 0.3%
(3.5% y/y).
Despite the drop in income, consumers raised spending by an expected 0.2% (3.2% y/y). That followed a 0.1% December uptick. Leading last month's spending was a 0.4% rise in services outlays. Offsetting the gain was a 0.8% decline (+5.4% y/y) in spending on durable goods and no change (+2.1% y/y) in nondurables purchases.
With the slump in income and the modest gain in spending, the personal savings rate fell to 2.4% and retraced its earlier rise.
The PCE chain price index was unchanged (+1.2% y/y) for the second consecutive month. Nondurables prices fell 0.3% (+1.0% y/y). Durable goods prices were unchanged (-1.6% y/y) and services prices ticked up 0.1% (1.8% y/y). Excluding food & energy, the price index gained 0.1% (1.3% y/y).
Adjusted for price changes, disposable income slumped 4.0% (+0.6% y/y) and real spending inched up 0.1% (2.0% y/y) during January.
The personal income & consumption figures are available in Haver's USECON and USNA databases. The consensus expectation figure is in the AS1REPNA database.
| Personal Income & Outlays (%) | Jan | Dec | Nov | Y/Y | 2012 | 2011 | 2010 |
|---|---|---|---|---|---|---|---|
| Personal Income | -3.6 | 2.6 | 1.0 | 2.2 | 3.5 | 5.1 | 3.8 |
| Wages & Salaries | -0.6 | 0.7 | 1.1 | 2.9 | 3.3 | 4.0 | 2.1 |
| Disposable Personal Income | -4.0 | 2.7 | 1.0 | 1.8 | 3.3 | 3.8 | 3.8 |
| Personal Consumption Expenditures | 0.2 | 0.1 | 0.4 | 3.2 | 3.7 | 5.0 | 3.8 |
| Personal Saving Rate | 2.4 | 6.4 | 4.0 | 3.7 (Jan'12) |
3.9 | 14.2 | 5.1 |
| PCE Chain Price Index | 0.0 | -0.0 | -0.2 | 1.2 | 1.7 | 2.4 | 1.9 |
| Less Food & Energy | 0.1 | 0.0 | 0.1 | 1.3 | 1.7 | 1.4 | 1.5 |
| Real Disposable Income | -4.0 | 2.7 | 1.2 | 0.6 | 1.5 | 1.3 | 1.8 |
| Real Personal Consumption Expenditures | 0.1 | 0.1 | 0.5 | 2.0 | 1.9 | 2.5 | 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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