2017 Economic Calendar
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Personal Income and Outlays  
Released On 3/31/2017 8:30:00 AM For Feb, 2017
PriorPrior RevisedConsensusConsensus RangeActual
Personal Income - M/M change0.4 %0.5 %0.4 %0.3 % to 0.5 %0.4 %
Consumer Spending - M/M change0.2 %0.2 %0.1 % to 0.3 %0.1 %
PCE Price Index -- M/M change0.4 %0.1 %0.1 % to 0.1 %0.1 %
Core PCE price index - M/M change0.3 %0.2 %0.1 % to 0.3 %0.2 %
PCE Price Index -- Y/Y change1.9 %2.1 %2.1 % to 2.1 %2.1 %
Core PCE price index - Yr/Yr change1.7 %1.8 %1.7 %1.7 % to 1.8 %1.8 %

Highlights
A second month of weak spending on services pulled down consumer spending which could only manage a 0.1 percent rise in February, one that follows a nearly as weak 0.2 percent gain in January. February's result is below consensus and at the low end of the Econoday forecast range.

Income data are more favorable headlined by an as-expected 0.4 percent gain and a very solid 0.5 percent increase in the wages & salaries component. And consumers moved money into the bank as the savings rate climbed 2 tenths for a second straight month to 5.6 percent. Increases in savings are a factor behind the weakness in spending.

Inflation data are mixed as monthly rates are tame but year-on-year rates, reflecting low prices this time last year, are moving higher. For the first time in nearly 5 years, the PCE price index is over the Federal Reserve's 2 percent target, up an expected 2 tenths to 2.1 percent. The monthly rate, however, rose only 0.1 percent which if extended into future months would point to easing pressure for the year-on-year as last year's comparisons become harder.

The PCE core rose a tame looking 0.2 percent on a monthly basis but here the year-on-year rate is 1 tenth higher than expectations at 1.8 percent. And the rate for January is now revised 1 tenth higher and is also now at 1.8 percent.

The pressure on the core rate is very delicate for the Federal Reserve which does not expect this reading to accelerate, only stabilize quietly just under or just at the 2 percent line. The gain in income in this report hints at wages perhaps adding to inflationary pressures, a possibility that will be tested in the average hourly earnings reading in next week's employment report.

Along with the risk of less-than-tame inflation is the risk of a less-than-excited consumer who, after a vehicle-buying spree in the fourth quarter, may be cutting back and putting money into the bank. This may be good for consumer health and the long-term outlook, but it won't help first-quarter GDP which, after today's report, now looks to be decidedly soft.

Recent History Of This Indicator
On a nominal basis, personal income has been growing in the modest 3 to 3-1/2 percent range the past year though wages & salaries have been in the 4 percent range. Consumer spending has been on a moderate rise to the 4 percent range, again before inflation. For January, forecasters see income rising a monthly 0.4 percent with spending up only 0.2 percent in what points to softness for first-quarter GDP. Key in this report will be the PCE price index which has been on the rise and is expected to post a monthly gain of 0.1 percent to keep the year-on-year rate at 2.1 percent. The core PCE (less food & energy) is expected to rise 0.2 percent with this yearly rate holding at 1.7 percent and safely below the Federal Reserve's 2 percent target.

Definition
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
 
[Chart]
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
 
[Chart]
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
 
 

2017 Release Schedule
Released On: 1/303/13/315/15/306/308/18/319/2910/3011/3012/22
Release For: DecJanFebMarAprMayJunJulAugSepOctNov
 


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