2013 Economic Calendar
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Personal Income and Outlays  
Released On 8/30/2013 8:30:00 AM For Jul, 2013
PriorPrior RevisedConsensusConsensus RangeActual
Personal Income - M/M change0.3 %0.2 %-0.1 % to 0.3 %0.1 %
Consumer Spending - M/M change0.5 %0.6 %0.3 %0.0 % to 0.5 %0.1 %
PCE Price Index -- M/M change0.4 %0.2 %0.1 % to 0.3 %0.1 %
Core PCE price index - M/M change0.2 %0.2 %0.1 % to 0.2 %0.1 %
Personal Income - Yr/Yr change3.1 %3.1 %3.3 %
Consumer Spending - Yr/Yr change3.3 %3.4 %3.1 %
PCE Price Index -- Y/Y change1.3 %1.4 %
Core PCE price index - Yr/Yr change1.2 %1.2 %
Personal Outlays - $ level11.882 thous billion $

The third quarter is having a bumpy start as both personal income and personal spending were near flat. Personal income inched up 0.1 percent in July after gaining 0.3 percent the month before. Analysts expected a 0.2 percent gain. However, the wages & salaries component was notably weak, declining 0.3 percent after an increase of 0.4 percent in June.

Consumer spending slowed sharply to a 0.1 percent rise in July but followed a strong 0.6 percent boost the month before. July posted lower than market expectations for a 0.3 percent increase. Weakness was led by a 0.2 percent dip in durables, following a 0.9 percent jump the prior month. Services were unchanged after a 0.3 percent advance in June. Strength was in nondurables, up 0.9 percent after a 1.2 percent spike in June.

Headline inflation eased notably to a 0.1 percent rise in July from a 0.4 percent jump in June. The core inflation rate slowed to a 0.1 percent increase from 0.2 in June.

Little to no progress was seen in PCE inflation getting to the Fed's goal of 2 percent. Year-on-year, headline prices were up 1.4 percent in July versus 1.3 percent in June. The core held steady at 1.2 percent compared to June.

The latest inflation numbers leave the Fed plenty of room to maintain quantitative easing and the income and spending numbers also are soft. The employment situation report out next week will be important for the Fed's decision on tapering or not at its mid-September policy meeting. Given that a number of Fed officials want to start tapering, it looks like "taper lite" unless there is a really strong employment report.

Consensus Outlook
Personal income in June advanced 0.3 percent in June percent after a 0.4 percent rise in May. The wages & salaries component grew a robust 0.5 percent, following a 0.3 percent boost in May. Consumer spending surged 0.5 percent in June, following a 0.2 percent rise the prior month. Nondurables led the gain, boosted by gasoline prices. Durables also were strong due to auto sales. Headline inflation was stronger with a 0.4 percent increase after rising 0.1 percent in May. The core inflation rate rose 0.2 percent in June, following a 0.1 percent gain in May. Looking ahead, private aggregate earnings slipped 0.1 percent in July and suggest softness in the private wages & salary component of personal income. There is notable uncertainty about July consumer spending. Unit new motor vehicle sales declined 1.8 percent in July while retail sales excluding autos gained 0.5 percent. PCE inflation should ease at the headline level as the CPI slowed to 0.2 percent in July from 0.5 percent the month before. The core CPI also posted at 0.2 percent for July.

Personal income represents the income that households receive from all sources including wages and salaries, fringe benefits such as employer contributions to private pension plans, proprietors' income, income from rent, dividends and interest and transfer payments such as Social Security and unemployment compensation. Personal contributions for social insurance are subtracted from personal income.

Personal consumption expenditures are the major portion of personal outlays, which also include personal interest payments and transfer payments. Personal consumption expenditures are divided into durable goods, nondurable goods and services. These figures are the monthly analogues to the quarterly consumption expenditures in the GDP report, available in nominal and real (inflation-adjusted) dollars. Economic performance is more appropriately measured after the effects of inflation are removed.

Each month, the Bureau of Economic Analysis also compiles the personal consumption expenditure price index, also known as the PCE price index. This inflation index measures a basket of goods and services that is updated annually in contrast to the CPI, which measures a fixed basket.

 Why Investors Care
Changes in taxes or social security cost of living adjustments can cause some sharp variations in monthly disposable income growth. However, on the whole, monthly changes in disposable income fluctuate less than monthly changes in personal consumption expenditures.
Data Source: Haver Analytics
Monthly changes in personal consumption expenditures are usually skewed by large changes in spending on durable goods. Spending on nondurable goods and services tend to be less volatile from one month to the next.
Data Source: Haver Analytics

2013 Release Schedule
Released On: 1/313/13/294/295/316/278/28/309/2711/812/612/23
Release For: DecJanFebMarAprMayJunJulAugSepOctNov

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