by Calculated Risk on 6/26/2020 08:36:00 AM

The BEA released the Personal Income and Outlays report for May:

Personal income decreased $874.2 billion (4.2 percent) in May according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) decreased $911.1 billion (4.9 percent) and personal consumption expenditures (PCE) increased $994.5 billion (8.2 percent).

Real DPI decreased 5.0 percent in May and Real PCE increased 8.1 percent (tables 5 and 7). The PCE price index increased 0.1 percent. Excluding food and energy, the PCE price index increased 0.1 percent.

The May PCE price index increased 0.5 percent year-over-year and the May PCE price index, excluding food and energy, increased 1.0 percent year-over-year.

The following graph shows real Personal Consumption Expenditures (PCE) through May 2020 (2012 dollars). Note that the y-axis doesn't start at zero to better show the change.

Click on graph for larger image.

The dashed red lines are the quarterly levels for real PCE.

The decrease in personal income was less than expected,  and the increase in PCE was below expectations.

Note that core PCE inflation was below expectations.