by Bill McBride on 12/23/2015 08:30:00 AM
Wednesday, December 23, 2015
Personal income increased $44.4 billion, or 0.3 percent, ... according to the Bureau of Economic Analysis. Personal consumption expenditures (PCE) increased $40.1 billion, or 0.3 percent.The following graph shows real Personal Consumption Expenditures (PCE) through November 2015 (2009 dollars). Note that the y-axis doesn't start at zero to better show the change.
Real PCE -- PCE adjusted to remove price changes -- increased 0.3 percent in November, in contrast to a decrease of less than 0.1 percent in October. ... The price index for PCE increased less than 0.1 percent in November, compared with an increase of 0.1 percent in October. The PCE price index, excluding food and energy, increased 0.1 percent, compared with an increase of less than 0.1 percent.
The November PCE price index increased 0.4 percent from November a year ago. The November PCE price index, excluding food and energy, increased 1.3 percent from November a year ago.
Click on graph for larger image.
The dashed red lines are the quarterly levels for real PCE.
The increase in personal income was larger than expected. And the increase in PCE was at the 0.3% increase consensus.
On inflation: The PCE price index increased 0.4 percent year-over-year due to the sharp decline in oil prices. The core PCE price index (excluding food and energy) increased 1.3 percent year-over-year in November.
Using the two-month method to estimate Q3 PCE growth, PCE was increasing at a 2.1% annual rate in Q3 2015 (using the mid-month method, PCE was increasing 2.0%). This suggests PCE growth will slow in Q4.
Posted by Bill McBride on 12/23/2015 08:30:00 AM