Income and Outlays Rose $88.6 Billion and $62.1 Billion, Respectively; Personal Saving Rate 6.1%
The Bureau of Economic Analysis (BEA) reported personal income rose $88.6 billion (0.5%) in May, stronger than the consensus forecast. The gain in the component of the personal income and outlays report was largely driven by increases in personal interest income, wages and salaries.
Disposable personal income (DPI) rose $72.6 billion (0.5%). Personal consumption expenditures (PCE), or consumer spending, increased $59.7 billion (0.4%).
| Indicator | Prior | Revised | Consensus Forecast | Forecast Range | Result |
| Personal Income – M/M ∆ | 0.5% | 0.3% | 0.1% to 0.4% | 0.5% | |
| Consumer Spending – M/M ∆ | 0.3% | 0.6% | 0.4% | 0.2% to 0.5% | 0.4% |
| PCE Price Index M/M ∆ | 0.3% | 0.1% | 0.1% to 0.2% | 0.2% | |
| Core PCE Price Index – M/M ∆ | 0.2% | 0.1% | 0.1% to 0.2% | 0.2% | |
| PCE Price Index Y/Y ∆ | 1.5% | 1.6% | 1.4% | 1.4% to 1.5% | 1.5% |
| Core PCE Price Index – Yr/Yr ∆ | 1.6% | 1.5% | 1.5% to 1.6% | 1.6% |
Real DPI gained 0.3% in May and real PCE by 0.2%. The PCE price index increased 0.2%. Excluding food and energy, the PCE price index was up 0.2%.
“Given that there wasn’t a bump in the year-over-year growth rate for either the PCE Price Index or the core PCE Price Index, financial market’s will continue to price in a rate cut,” Tim Anderson, analyst at TJM Investments at NYSE said. “The PCE declined to 1.5% from 1.6% and the core was unchanged at 1.6%.”
The Federal Open Market Committee (FOMC) meets from July 30 – 31.
Personal outlays gained $62.1 billion and personal saving was $985.4 billion. The personal saving rate — which is personal saving as a percentage of disposable personal income — was 6.1%.
| 2019 | |||||
|---|---|---|---|---|---|
| Jan. | Feb. | Mar. | Apr. | May | |
| Percent change from preceding month | |||||
| Personal income: | |||||
| Current dollars | -0.1 | 0.2 | 0.1 | 0.5 | 0.5 |
| Disposable personal income: | |||||
| Current dollars | -0.2 | 0.1 | 0.0 | 0.5 | 0.5 |
| Chained (2012) dollars | -0.2 | 0.1 | -0.2 | 0.1 | 0.3 |
| Personal consumption expenditures (PCE): | |||||
| Current dollars | 0.3 | -0.2 | 1.0 | 0.6 | 0.4 |
| Chained (2012) dollars | 0.4 | -0.3 | 0.8 | 0.2 | 0.2 |
| Price indexes: | |||||
| PCE | -0.1 | 0.1 | 0.2 | 0.3 | 0.2 |
| PCE, excluding food and energy | 0.1 | 0.0 | 0.1 | 0.2 | 0.2 |
| Price indexes: | Percent change from month one year ago | ||||
| PCE | 1.4 | 1.3 | 1.5 | 1.6 | 1.5 |
| PCE, excluding food and energy | 1.8 | 1.7 | 1.5 | 1.6 | 1.6 |
