2018 Economic Calendar
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Personal Income and Outlays  
Released On 7/31/2018 8:30:00 AM For Jun, 2018
PriorPrior RevisedConsensusConsensus RangeActual
Personal Income - M/M change0.4 %0.4 %0.3 % to 0.4 %0.4 %
Consumer Spending - M/M change0.2 %0.5 %0.4 %0.4 % to 0.5 %0.4 %
PCE Price Index M/M change0.2 %0.1 %0.1 % to 0.2 %0.1 %
Core PCE price index - M/M change0.2 %0.2 %0.0 % to 0.6 %0.1 %
PCE Price Index Y/Y change2.3 %2.2 %2.3 %2.3 % to 2.4 %2.2 %
Core PCE price index - Yr/Yr change2.0 %1.9 %2.0 %1.9 % to 2.2 %1.9 %

Highlights
Easing inflation pressure along with healthy consumer vital signs is the message from the personal income & outlays report for June. Both price indexes, the overall and the closely watched core rate which excludes food and energy, posted only marginal 0.1 percent gains in June with year-on-year rates favorable, at 2.2 percent overall and at 1.9 percent for the core, both unchanged from downwardly revised results in May. The movement in inflation is coming back toward the Fed's 2 percent target line, not away from it.

Personal income rose a useful 0.4 percent with the wages & salaries component also at 0.4 percent. The savings rate was shifted sharply higher in last week's benchmark GDP revisions in what is a very fundamental sign of health. The savings rate held unchanged in June at 6.8 percent.

The consumer didn't dip into savings to keep up spending which was a solid 0.4 percent with May revised sharply upwards, from an initial 0.2 percent gain to 0.5 percent. Spending on services rose 0.6 percent in June to offset what is a small disappointment in today's report which is no change in spending on durables.

The inflation readings in today's report are complemented by a little less pressure in the employment cost index which was also released this morning. Together, they ease the pressure on the Federal Reserve and may help to keep down any hawkish edge to Wednesday's FOMC statement.

Consensus Outlook
Both personal income and consumer spending are seen rising a moderate-to-solid 0.4 percent in June. Note that the data will unbundle June's contribution from last week's second-quarter GDP report. The core PCE price index, which excludes both food and energy, is seen posting a 0.2 percent monthly rise for a year-on-year gain of 2.0 percent. This index, which is the most closely watched of all inflation readings, first hit the Fed's 2 percent goal in the May report. The consensus for the overall price index is for a 0.1 percent monthly gain and a year-on-year rate of 2.3 percent.

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 sharp variations in monthly disposable income. But monthly changes in disposable income generally 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
 
 

2018 Release Schedule
Released On: 1/293/13/294/305/316/297/318/309/2810/2911/2912/21
Release For: DecJanFebMarAprMayJunJulAugSepOctNov
 


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