Personal Income and Spending: ‘abyssus abyssum invocat’.

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Personal Income and Spending

Takeaways

+ The core PCE price index( ex. food and energy) rose 0.08% (M/M) in November, additionally, the (Y/Y) rate increased to 1.48%.

+Core inflation was, of course, reported below the Street’s estimates, falling 3bp in financial services (+0.02%) and other services (-1.3%). The area that did see an uptick in inflation was recreational goods, reported at (+0.03%)

+ The headline PCE prices, the one most will react to, without looking under the hood, some would say, increased +0.23% (M/M) ; moreover, the (Y/Y) rate also accelerated to 1.8%. Which read through to the +4.3 jump in energy prices (M/M).

+Personal Income rose 0.3% (M/M) in November; perhaps the tax bill will continue to incentives businesses to reward their employees with bonuses, which could offset the below-consensus print. Next month’s data will be interesting to see the result of the tax bill passing.

+Nice to see that wage and salary income ticking up a hair, reported at 0.4% in November.

+ Personal Spending rose to 0.6%, which was above consensus estimates, that being said, it came at the expense of the personal savings rate to decline by three-tenths of one percent to 2.9%. Heard on Bloomberg, that this type of consumer behavior was last seen pre-GFC; so you know, heads up, watch your six.

+ Lastly, the only revisions to come in the Census sBeauru’s report was that growth in disposable personal income (DPI) was revised down one-tenth of one percent in October.

 

 

 

Table 1. Personal Income and Its Disposition (Months)

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Table 2. Personal Income and Its Disposition (Years and Quarters) (Not Shown)

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Table 5. Personal Income and Its Disposition, Percent Change from Preceding Period

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Table 7. Real Personal Consumption Expenditures (PCE) by Major Type of Product

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