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2008 Economic Calendar |
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Resource Center » U.S. & Intl Recaps | Release Dates | Why Investors Care | Today's Calendar
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Personal income is the dollar value of income received from all sources by individuals. Personal outlays include consumer purchases of durable and nondurable goods, and services. Why Investors Care
| Released on 6/1/07 For Apr 2007 | |||||||||||||||||||||||||
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Highlights
Today's personal income report came in with technically negative income growth, strong spending, but modest core inflation. Personal income fell 0.1 percent in April, following a 0.8 percent jump the prior month. Income was pulled down by a 0.4 percent drop in wages & salaries income. April's wages and salaries component was coming off a first quarter surge in "unusually large bonus payments and the exercise of stock options," according to the Bureau of Economic Analysis in the Commerce Department. This component surged 0.7 percent in March. The consensus had expected a 0.3 percent boost in April income.
Personal consumption expenditures increased a robust 0.5 percent, following a 0.4 percent rise in March. Spending came in above the consensus forecast for a 0.4 percent gain in consumer spending. Consumer spending was led by a 0.8 percent jump in services and a 0.3 percent increase in nondurables spending. Durables dipped 0.2 percent for the month.
The personal saving rate fell to minus 1.3 percent in April from minus 0.7 percent the prior month.
On the inflation front, the overall PCE deflator came in at 0.3 percent, following a 0.4 percent boost in March. The core PCE price index (excluding food and energy) remained subdued with a 0.1 percent increase, following no change in March. The consensus had forecast a 0.2 percent rise in the core PCE price index. The unrounded percent change for the core PCE price index was 0.11531 percent, compared to 0.03786 percent in March.
Personal income on a year-on-year basis slipped to up 5.9 percent from up 6.0 percent in March. The wages and salaries component edged down to up 5.2 percent year-on-year in April from up 5.3 percent in March.
On a year-on-year basis, the overall PCE deflator is declined to up 2.2 percent in April from up 2.3 percent in March. On a year-on-year basis, the core PCE deflator slipped to up 2.0 percent from up 2.1 percent in March.
Taking into account the technical factors behind the drop in personal income, this report shows a healthy consumer sector with core inflation being quite favorable for two consecutive months. Bonds and equities should like the report.
Personal income was quite robust in March with a 0.7 percent gain - equaling February's increase. The important wages & salaries component rose 0.7 percent, following a 0.5 percent advance in February. Personal consumption expenditures, however, slowed to a 0.3 percent increase, following a 0.7 percent rise in February. Much of the gain was price related due to a boost in gasoline and heating oil. On the inflation front, the overall PCE deflator was still high with a 0.4 percent gain in March, the same as in the prior month. Higher oil prices boosted both months. However, the core PCE price index (excluding food and energy) eased to no change, following a 0.3 percent rise in February.
Personal income Consensus Forecast for April 07: +0.3 percent
Range: -0.1 to +0.5 percent
Personal consumption expenditures Consensus Forecast for April 07: +0.4 percent
Range: +0.3 to +0.5 percent
Core PCE price index Consensus Forecast for April 07: +0.2 percent
Range: +0.1 to +0.2 percent
![[Chart]](chart.gif)
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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. |
![[Chart]](chart_1.gif)
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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. |
| Personal Income and Outlays: 2007 Release Schedule | ||||||||||||||||||||||||||
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