U.S. Personal Income Rose in February

Personal consumption expenditures (PCE) increased 0.2% (7.6% y/y) during February, following an upward revision to 2.0% (8.2% y/y) from 1.8% (7.9% y/y) during January. A 0.2% rise had been expected in the Action Economics Forecast Survey.

In February, real PCE decreased 0.1% (+2.5% y/y) from a 1.5% (2.7% y/y) advance in January, revised up from 1.1% (2.4% y/y).

Real spending on durable goods dropped 1.2% (+2.7% y/y) in February, following an upwardly revised jump of 6.8% (2.5% y/y) in January from 5.2% (0.5% y/y). Spending on motor vehicle & parts retrenched last month by 3.9% (+3.3% y/y) after a 14.8% surge (1.2% y/y) in January, revised up from 11.9% (-1.7% y/y). Real spending on furniture & appliances dropped 0.4% (+1.4% y/y) after a 2.6% (1.6% y/y) gain in January. Real spending on recreational goods & vehicles rose 0.5% (4.7% y/y) after a 3.0% (4.4% y/y) rise in January.

Real spending on nondurable goods rose 0.5% (0.9% y/y) after a 0.9% (-0.7% y/y) rise in January, revised up from 0.5% (-1.4% y/y). Real apparel spending fell 1.0% (+4.6% y/y) in February, after a 3.6% (4.8% y/y) rise in January, revised up from a 3.0% (3.5% y/y) rise. Outlays on gasoline & other energy products rose 3.2% (-1.5% y/y) last month, following a 1.8% (-0.5% y/y) decline in January, and real food & beverage outlays rose 0.5% (-2.3% y/y) following a 0.2% (-5.3% y/y) rise in January.

Real spending on consumer services eased 0.1% (+3.0% y/y) in February, after a 0.7% (3.9% y/y) rise in January, revised up slightly from 0.6% (4.1% y/y). Recreation services buying declined 0.4% (+6.2% y/y) from a rise of 1.9% (8.9% y/y) in January, revised up from 1.4% (7.9% y/y), while real food services and accommodations declined 2.1% (+5.9% y/y) following a 4.0% (13.7% y/y) advance in January. Real transportation services outlays rose 1.1% (2.0% y/y) from a 0.8% (2.9% y/y) rise in January, while real housing & utilities expenditures rose 0.1% (0.3% y/y) after a 0.9% (-0.4% y/y) fall in January. Real healthcare spending gained 0.3% (4.6% y/y) last month after a 0.4% (4.2% Y/Y) rise in January. Financial services & insurance expenditures rose 0.4% (2.4% y/y) after a 0.7% (2.4% y/y) rise in January.

Personal income rose 0.3% (6.2% y/y) in February, after an unrevised rise of 0.6% (6.4% y/y) during January. A 0.2% rise had been expected in the Action Economics Forecast Survey. The gain reflected a 0.3% (7.3% y/y) rise in wages & salaries following a 0.9% (7.8% y/y) increase in January. Proprietors' income eased 0.1% (+4.2% y/y) last month, following a 0.1% (+6.0% y/y) decline in January. Rental income rose 1.4% (13.2% y/y) after a 1.2% (12.2% y/y) rise in January. Receipts on assets rose 0.2% (5.9% y/y) after a rise of 0.5% (5.7% y/y) in January as interest income rose 0.3% (9.1% y/y), and dividend income increased 0.2% (2.5% y/y). Personal transfer receipts rose 0.5% (4.3% y/y) in February after a 0.1% (3.7% y/y) uptick in January.

Disposable income rose 0.5% (8.4% y/y) in February, following a 2.0% (8.5% y/y) rise in January. Taxes fell 0.6% (-6.7 % y/y), after an 8.3% (-5.5% y/y) drop in January. Real disposable earnings rose 0.2% (3.3% y/y) last month, following a 1.5% (3.0% y/y) in January.

The personal saving rate rose to 4.6% from 4.4% in January, reported earlier as 4.7%. The level of personal savings increased 5.7% m/m and 12.6% y/y last month.

The PCE chain price index increased 0.3% (5.0% y/y) in February, following the 0.6% (5.3% y/y) rise in January. The index excluding food & energy (core) also rose 0.3% (4.6% y/y), following a 0.5% (4.7% y/y) rise in January. Goods prices rose 0.2% (3.6% y/y), while services prices gained 0.3% (5.7% y/y). The PCE services price index excluding energy & housing increased 0.2% (4.6% y/y), down from 0.5% (4.6% y/y) in January. Energy prices eased 0.4% (5.1% y/y) in February following a 2.0% (9.6% y/y) rise in January, while food prices rose 0.2% (9.7% y/y), from 0.4% (11.1% y/y) in January.

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